Investors are preparing for this afternoon when tech titans Google and IBM will report their corporate earnings. What is the best investment play in the technology sector? Robert Cihra, tech hardward analyst at Caris & Company and Benjamin Schacter, Internet analyst at Broadpoint AmTech shared their views.
“We really like Google and we think the continued momentum is going to be strong,” Schacter told CNBC. “The macro recovery is going to start first at Google and the online advertising companies.”
Schacter said he has a price target of about $575 on Google.
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“As long as numbers continue to rise, which it seems they will—as long as margins are going in the right direction, cost containment is there and topline continues to grow—you should see the stock continue to rise,” he said.
Cihra said he expects a "good report" from IBM .
“While their revenues will be down year over year, that rate of decline is going to start getting better and that’s going to show that enterprise spending, while still weak, is getting better,” he said.
“[IBM’s] upside is coming more from its [own] ability to improve margins and so while I’m looking for revenues to be down single digits, I’m looking for EPS to be up 18 percent of so.”
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Cihra expects that the technology sector, which has led the markets so far this year, will continue to be the leader throughout the year.
“Long term, international is going to be the driver for tech,” he said. “But some of the best near-term signs of improvement have been coming from the U.S.”
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No immediate information was available for Cihra or Schacter.