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Nasdaq at 2500: Does the Tech Rally Have Legs?

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The recent rise in the Nasdaq may bring back happy, as well as painful, memories for tech investors. Analysts appearing on CNBC's "Morning Call" disagreed over whether or not the Nasdaq has more room to run.

Even though the Nasdaq is up 25% since July, to around 2500, David Dietze, President and Chief Investment Strategist at Point View Financial Services, believes the tech-heavy index could rise another 20% in the next year.

Dietze says analysts are projecting a 15% growth rate in earnings and Nasdaq 3000 is only 19% away. He says a "slight bump up in the multiple" will get the index to that level. Dietze believes the main drivers of growth in technology will be the new Microsoft Vista software and demand for internet technology overseas, particularly in China.

The Nasdaq is still only halfway to reaching its all-time high of 5048 hit back during the 2000 dot.com bubble. Peter Boockvar, Equity Strategist at Miller Tabak, says it's a mistake to look at technology like we're back in that era. He believes valuation is a problem with the Nasdaq trading at 40 times earnings. Boockvar also notes Vista had a disappointing rollout. He says IT spending has been moderate and the wireless inventory correction is ongoing.

Dietze counters that Vista's impact is inevitable and that growth in the internet will drive other Nasdaq stocks such as Cisco and Google. However, Boockvar says the Nasdaq is "more likely to trade at 2000 than 3000."