Prudential's Keon: Gap Between Tech Stks,
Mkt To Grow
NEW YORK -- The gap in stock performance between technology firms
and rest of the market will continue to grow, said Ed Keon, director of
quantitative research at Prudential Securities Inc.
Investors will pay "gigantic prices" for technology stocks because they
"believe that certain sectors in the marketplace - especially wireless,
business-to-business Internet, biotech - they have exciting futures (and)
they're going to grow by leaps and bounds over the next few years," said
Keon in a CNBC interview Monday.
People are less enthusiastic about the rest of the market, which is dogged
by interest rate concerns, an uncertain outlook and high valuations, he said.
Keon outlined two ways of investing in the new economy: Buy the high
fliers and "stomach" high volatility, or buy more traditional companies that
show they are using the Internet to "leverage their current business."
Keon said "stellar" tech performers include Qualcomm Inc. (QCOM),
which stands to benefit from huge growth in wireless capacity;
business-to-business Internet company i2 Technologies Inc. (ITWO); and
biotech leader Amgen Inc. (AMGN).
Keon's "Internet spin" picks are General Electric Co. (GE), Ford Motor
Co. (F), General Motors Corp. (GM) and Indymac Mortgage Holdings
Inc. (NDE). He said these companies are traditional names that are making
great strides in business-to-business and business-to-consumer Internet
service.
-Riva Richmond; Dow Jones Newswires; 201-938-4046
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