Market Dive Overdone For Tech-laden NASDAQ, According To Technology Expert Michael Murphy
Business Wire - October 27, 1997 19:42
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SAN DIEGO--(BUSINESS WIRE)--Oct. 27, 1997--The bloodbath on Wall Street Monday may present patient technology investors with long-term opportunities in its wake, a noted technology expert said Monday.
Michael Murphy, editor of the California Technology Stock Letter, said the pummeling of all major indices, including the technology-laden NASDAQ, while understandable given the herd instincts on Wall Street, was probably overdone.
"I don't understand why the technology sector got hit so badly, but if the market goes through circuit breakers early again tomorrow morning, the NASDAQ will likely get ripped, too," Murphy said. "If this is going to be a crash, it will happen tomorrow morning when margin selling kicks in on the one side while (Alan) Greenspan and (Robert) Rubin will be on the other side (trying to calm market fears)."
Murphy is the featured speaker at the 1997 Informed Investors Electronics & Technology Forum Sunday morning Nov. 2 in San Diego. Murphy's perspective is grounded in nearly 30 years investing in technology and biotechnology.
The Nov. 2 Forum runs from 8 a.m. to noon at the Mission Valley DoubleTree Hotel. The cost is $15 pre-paid, $20 at the door which includes a continental breakfast served at 7:30. Investors unable to attend may order tapes of the Forum for $25 for company presentations and Murphy's commentary. To register or order tapes, call Informed Investors Forum at 800/992-4683.
Companies who will be giving presentations are Credence Systems (NASDAQ:CMOS), In Focus Systems (NASDAQ:INFS), Trimble Navigation (NASDAQ:TRMB), Lernout & Hauspie (NASDAQ:LHSPF) and Watkins-Johnson (NYSE:WJ). Up to eight companies may present.
"We're waiting to see what happens tomorrow," Murphy said. "There is no reason the technology companies should be hit so badly because we believe the PC industry will have a decent fourth quarter and good 1998. We also think telecom will be good, too."
Moreover, Murphy said semiconductor equipment companies should be strong. "These companies are driven by product cycles, not economic cycles, and there is a significant product transition under way in semiconductor manufacturing."
Murphy mentioned several stocks his money management firm may look to buy upon further weakness, including LSI Logic (NYSE:LSI), IDT (NASDAQ:IDTC), Seagate Technology (NYSE:SEG) and "and probably Applied Materials (NASDAQ:AMAT)."
"We may even be able to pick up Intel (NASDAQ:INTC) tomorrow morning at our buy price of $70," Murphy said.
While the troubles in Asia are real, Murphy said, the companies that will be hurt the most include consumer cyclicals because of slower potential growth and financial institutions which will be hurt by the "asset deflation" occurring in Asia.
"Coca-Cola (NYSE:CKE) and Phillip Morris (NYSE:MO) are companies that could be hurt by lower growth," Murphy said. "On the other hand, very little of the end user market of technology actually ends up in Asia."
Even if the market takes another big dip Tuesday, Murphy feels technology issues will lead the rebound when it inevitably occurs. "Money will go to bonds and cash first, but when it comes back into the market, it will go to techs because they are the fast-growing companies."
Forum organizer Informed Investors of Sacramento has been providing investment education to individual investors since 1993. In recent months, Forums have showcased companies including Cypress Semiconductor (NYSE:CY), Cymer, Inc. (NASDAQ:CYMI), Lucent Technologies (NYSE:LU), Isis Pharmaceuticals (NASDAQ:ISIP), Chiron Corp. (NASDAQ:CHIR) and many others.
For more information, email Informed Investors at info@informedinvestors.com or call 800/992-4683. Visit informedinvestors.com for information about Informed Investors.
CONTACT: Informed Investors
Bob Taylor/Tim Quast or Steve Chanecka,
916/448-8222 or 800/992-4683
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