I think we could see a nice run up in tech stocks this week. The vote of confidence for Big Blue by Soundview [see A] and reports of sales pick-up in corporate PC purchases [see B] could drive INTC out of its narrow trading range into the low to mid $150 area, particularly with INTC's reported low P in the their P/E. This would do wonders for the tech sector, particularly networking [CSCO, COMS] and disk drives [WDC]. MSFT & GTW would probably move up as well. I don't know how much higher we'll see DELL, however. But nothing would surprise with this stock.
COMS reports after COB on Tuesday and that should be interesting. ZACK's is looking for 48› eps.
Consumer Confidence on Tuesday and that's about it for relatively important economic reports this week.
A]SoundView's repeated "buy" rating on IBM, stating IBM is "solidly on track for the quarter" "PCs are still very strong, hard disk drives are sold out, the mainframe disk storage based on Iceberg is sold out,"
B]WSJ Interactive Edition of Friday reported that "major resellers to corporations was, in fact, a slump that spilled over into April from the first quarter, but disappeared by May. The resellers indicated that purchasing activity has accelerated greatly over the past two weeks, following a brisk May. They said the upsurge has been fueled by a strong increase in sales to corporate buyers, who contributed to the industry's first-quarter slowdown by holding off on major purchases as many sorted through a spate of new technology announcements.
"Corporate customers were putting everything on hold, but now it looks like everything is going crazy," said Ahmad Manshouri, general manager of operations for Vanstar Corp., a big reseller based in Pleasanton, Calif. Vanstar's personal-computer business so far this month is running 25% ahead of the same period in May, and the quarter is
on track to exceed the business of the year-earlier quarter by an undisclosed amount.
Tech Data Corp., a reseller based in Clearwater, Fla., reported its second-quarter demand is running "at least as well as planned," while another reseller, MicroAge Inc. of Tempe, Ariz., reported "upwards" of 30% growth in PC-unit shipments this quarter compared with last quarter, and an increase of as much as 50% year-over-year on some models." |
