After six months of a continuous rally in the market that
drove indices up some 30% over that time span, the last two weeks
has reminded investors there is still danger and turbulence in
the equity investing.
Personally, I believe we are in for at least a few bumpy
months as the crisis in Europe continues to unfold and
accelerate. In my portfolio I have approximately 25% of my
holdings in cash and another 10% in short positions as I believe
there will be better entry points in this market by summer.
I am deploying some of that capital to new positions on
significant down days. Although I believe the tech sector still
has some long term upside, I would avoid some of the name stocks
in this space that have already had huge runs like Apple (NASDAQ:
). I prefer to select slower growing, less known names in the
tech arena. They will not run up as fast in a rally, but should
lose a lot less if the market goes into a tailspin. Here are two
with very reasonable values I think investors should
) - "Symantec Corporation provides security, storage, and systems
management solutions internationally. The company's Consumer
segment delivers Internet security, PC tune-up, and online backup
solutions and services to individual users and home offices."
(Business description from Yahoo Finance)
Reasons to Consider Symantec:
- The company is showing solid, if unspectacular earnings
growth. SYMC made $1.42 a share in FY2011 and analysts have it
making $1.63 in FY2012 and $1.79 in FY2013.
- This puts its Forward PE at right at 10 times, which is a
20% discount to its historical average.
- The stock is cheap at just 7 times operating cash
- The stock has a very low beta (.66) and the consensus price
target from the 23 analysts that cover the stock is $21. Credit
Suisse has an "Outperform" rating and a $25 price target on
Zebra Technologies (NASDAQ:
) - "Zebra Technologies Corporation offers products and solutions
that assist in identifying, authenticating, and tracking assets,
people, and transactions. The company's products include direct
thermal and thermal transfer label and receipt printers, radio
frequency identification printer/encoders, dye sublimation card
printers, real-time location solutions, and related accessories
and support software." (Business description from Yahoo
Reasons to consider Zebra Tech:
- Zebra has consistently beat consensus estimates over the
past four quarters. Its average beat over consensus during that
time period was around 8%. The stock has five year projected
PEG of under 1 (.99), an approximate 25% discount to its
- Consensus estimates for FY2012 and FY2013 have risen over
the past month and the mean analyst price target on ZBRA is
- The company is projected to grow revenue between 4% to 6%
annually over the next two years and it earnings are expected
to grow steadily from $2.44 in FY2011 to $2.88 in FY2013.
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