It's hard not to get sucked in by the allure of new technology
trends. We're in a time where the pace of innovation is extremely
visible, due in no small part to the sheer variety of consumer
electronic devices that offer extremely attractive features.
That same attraction applies to a growing number of
. I'm not saying I want to buy every tech stock out there - to be
sure there are a lot of duds. And there are plenty of examples
where valuations need to come down a bit.
But those caveats stated, it's still the case that for every
twenty "new" technology stocks I look at I'm compelled to dig
deeper into at least a handful. And my watch list has expanded to
around a half dozen that I consider to have very real potential
to double over the next 18 months.
Over the last couple of years we've seen a number of
disruptive technology breakthroughs, like
, that have completely changed the manufacturing game.
At the same time, there are numerous examples of technology
trends and innovation that I'd characterize as more evolutionary
than revolutionary. Wearable technologies are one. And the
greater functionality of mobile devices, like interconnectivity,
where you can control your home thermostat from your phone, is
is the new hot technology trend to watch. Items like the Nike (
) FuelBand, GoPro camera and Samsung Galaxy Gear smartwatch are
already selling well. The next iterations will be even lower
profile wearable cameras, brain monitors and motion sensors.
Other applications will be things like Google's (
) Helpouts application for professional training and impact
sensing for race car drivers and football players.
The clear winners in all of this are the component
manufacturers, especially specialized semiconductor companies.
The ones that are linked up with the major manufacturers have an
opportunity to grow exponentially as consumer electronics, like
wearables, tablets and smartphones, enter their next stage of
For the semiconductor companies that provide chips to a
broader set of customers, the pressure is heating up. As
competition (especially in the tablet and
) intensifies, companies are starting to introduce and retire new
products much more rapidly. This is putting tremendous pressure
on semiconductor companies to try and stay ahead of the
It's a monumental challenge to make the "next" great chip in
quantity, with few defects, while having the "next, next" great
chip also in development. This creates an opportunity for
companies that help semiconductor manufacturers improve their
yields, and reduce defects.
For many small tech companies, the upside is tremendous. Not
every stock that seems to fit the profile will be a winner of
course. But by focusing on the companies that communicate a clear
mission of what they're trying to accomplish, and support that
mission with a track record of performance, investors can
participate in tech's next great growth spurt.
Later this week we're holding a special event during which
I'll talk more about technology trends, as well as some emerging
consumer trends that should pique your interest.
Click here to register for this special event
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