Stuart --
I know what's needed: a contract announcement with Amati's name in bold print and $$$ signs followed by lots of zeros.
Here's a report from the Montgomery Securities Technology conference. We're in a winning sector, it's just a bit volatile. Not for the faint of heart.
Regards,
Pat
<<<Subj: IT Capital Equipment Spending Driving Overall Growth in Technology Sector,
Montg
Date: 96-12-10 14:43:40 EST
From: AOLNewsProfiles@aol.net
SAN FRANCISCO--(BUSINESS WIRE)--Dec. 10, 1996--Capital spending
on information technology (IT) is growing at a rate of more than 20
percent per year, fueling overall growth of the worldwide
high-technology sector that will soon result in sales of more than
$1 trillion per year, according to Thomas A. Thornhill, Director of
Technology Research for Montgomery Securities.
Thornhill made his comments at the 14th Annual Technology Week
investment conference being held this week by Montgomery Securities.
The conference features 159 high-technology companies making
presentations and meeting with growth-oriented institutional
investors, including leading high-technology companies such as Intel
Corp., Cisco Systems and Microsoft Corp.
Montgomery is forecasting overall growth of 15 to 20 percent in
capital spending on computing, instrumentation and communications
technology -- at a time when non-technology capital equipment
spending is declining. By the year 2000, overall worldwide spending
in the sector is projected to top $1.4 trillion, up from
approximately $950 billion in 1996. As a result, overall revenues
for technology companies are forecast to rise above the $1 trillion
level by 2000, up from $400 billion in 1995.
Despite a long bull market, Montgomery sees continuing
opportunities for investors in the high-technology sector. Among the
companies making presentations at the conference, Montgomery is
projecting an average annual growth rate of 32 percent but a 1997
price/earnings multiple of 27.3, leading Montgomery to conclude that
as a whole, the companies making presentations are actually selling
at a discount to their growth rate -- a significant opportunity for
investors looking for technology stocks to acquire.
Several trends are converging to fuel growth in this industry as
companies commit to a new round of technology spending designed to
increase productivity, Thornhill said. Foremost is a corporate
upgrade cycle, as companies convert to Windows-based desktop
computing on the Intel Pentium Pro microprocessor. Thornhill also
cited a new generation of client-server applications and rising data
communications needs as trends driving the upgrade cycle.
Behind the surge in information technology (IT) spending is a
growing belief among corporate decision-makers of the value in
high-tech spending. According to a new survey by Deloitte & Touche,
83 percent of CEOs polled said they viewed IT spending as a strategic
investment and 72 percent had explicit goals in their business plans
to increase IT spending in the future. The most common planned uses
for the newly acquired technology are the development of company
intranets, accessing the Internet and using e-mail systems, according
to the survey.
Driving overall demand for IT is its value as a tool to improve
productivity, customer service and quality, the CEOs said. Thornhill
noted that the shift away from traditional information processing
toward communications-rich applications is actually creating a new
product development cycle in high-tech development. Previously,
developments in hardware enabled software advances, which eventually
overwhelmed the capacity of the existing hardware and drove the next
generation of hardware development.
Now, Thornhill said, there is a third driver in the mix: the
bandwidth of the communications infrastructure. "Today," Thornhill
said, "bandwidth is the limiting factor" -- leading a multitude of
companies, large and small, into a race to solve this technological
problem. In the near future, as telephone, cable and wireless
solutions emerge to ease the bandwidth crunch, tens of millions of
new users will be using intranets and Internets delivering richer
forms of content including full-motion video, multimedia and even
three-dimensional content.
Montgomery Securities is one of the nation's premier investment
banking and institutional brokerage firms. Dedicated to growth
companies, Montgomery combines focus and specialization in Research
and Investment Banking with bulge-bracket capabilities in Global
Distribution and Large-Block Trading.
--30--nb/sf* gdr/sf
CONTACT:
Montgomery Securities
Elizabeth Snowdon, 415/627-2747
esnowdon@montgomery.com>>> |
