CNBC Stock Blog

'Get Ready' for Tech Outperformance: Strong Buys & Trends - Pt. 2


Tech stocks were among the worst performers this week. When will the sector see a turnaround—and should investors be buying on the dips? Scott Kessler, equity analyst at Standard & Poor’s, and John Aiken, director of equity research at Majestic Research, shared their sector outlooks.

Tech Turnaround on Horizon?

Aiken said the tech sector will become “bifurcated”—companies levered to business spending will see slowness while companies with innovative business models around consumers will do well.

"Those fall into three categories," he said of the latter.

"Companies with international exposure like Baidu and MercadoLibre, those that are levered to mobile and mobile Internet like Apple on the device side and Google or Facebook on the software side, and those that have a truly niche innovation such as Amazon or Priceline.”
(See stock quotes for these companies, below.)

Aiken’s Tech Trends:

Trending Below Consensus: Blue Nile, Expedia, Google

Trending Above Consensus: Amazon

For Kessler's views and strategy, see Part 1.

Stocks Mentioned in this Article:






Blue Nile


Scorecard—What They Said:

  • Aiken's Previous Appearance on CNBC (Jul. 9. 2010)
  • Kessler's Previous Appearance on CNBC (Jul. 20, 2010)

More Views on Tech:

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Kessler does not own shares of AAPL, EBAY, EMC, GOOG, IBM, LDK, NOK, ORCL, ENER, ERIC, ERTS, SNIC or VRSN.

No immediate information was available for Aiken or his firm.