These Tech Stocks Will Make Me Rich

Welcome to week 53 of my stock-picking throwdown with Mr. Market. Let's get right to the numbers:

Source: Yahoo! Finance.
*Tracking began on Aug. 7, 2008.
**Adjusted for dividends and other returns of capital.

Year one of three is in the books, and so far, I'm well ahead. But now is no time to get cocky; we could be in a "junk rally." Even so, I like my tech portfolio as much today as when I first assembled it. Here's a quick review of all five stocks.

Akamai
The most volatile stock in my portfolio, the leading content delivery network took a beating after failing to meet the Street's estimates for second-quarter earnings. However, the bears have overlooked Akamai's balance sheet, which is flush with hundreds of millions in cash (and counting). Better still, management so firmly believes in the company's ability to deliver Web video that insiders spent millions to buy shares after investors dumped the stock last week.

Harris & Harris
The tiny-tech investor celebrated a milestone in its second quarter, when net asset value (NAV) turned north after several quarters of declines. A looser IPO market also bodes well, offering liquidity opportunities for Harris & Harris' many portfolio companies. Of my five picks, this is the one I believe will be a multibagger before this contest is through.

IBM
I'm not counting on this stock to obliterate the market, as I expect my fast movers to, but few innovators are better situated to deliver steady, market-beating returns over the long term. A healthy and growing dividend is a pleasant bonus.

Oracle
CEO Larry Ellison is as sharp as they come. As long as he's leading, I'm following. Also, the Oracle database is one of those essential ingredients for business in a Web-driven world. Maintenance revenue from just this one product creates billions in annuity-like free cash flow.

Taiwan Semiconductor
Ah, my dividend delight. Taiwan Semiconductor's generous dividend payments have been a boon both here and in my real-money portfolio. In the longer term, I see a digital world needing more advanced chips, and no foundry is better positioned to manufacture them than TSMC.

The week in tech
My portfolio companies aren't the only ones doing well. Facebook stuck it to Twitter this week by combining with upstart FriendFeed, a social media aggregator. The new FaceFeed -- or Friendbook, whichever you prefer -- is positioning itself as social media's version of Yahoo!, an aggregator that also owns very high-traffic property. One thing's for sure, though: Facebook is doing everything it can to prep for the IPO bankers.

Meanwhile, Sirius XM (NASDAQ:SIRI), once desperate for the company of any banker, is no longer quite so needy. The satellite radio star this week priced $275 million in new senior debt paying 9.75%, a far cry from the 15% vig it promised Liberty Media just a few months ago.

Microsoft (NASDAQ:MSFT) also sought help this week, but from a partner, rather than a banker. Mr. Softy is teaming with Nokia to bring its Office Mobile suite to Nokia's Symbian smartphone OS. When deployed -- sometime next year, company officials say -- Microsoft's productivity software will be the standard for some 60% of the world's smartphones. Well played, sirs.

The loser in this, of course, is Windows Mobile -- though Microsoft won't admit to that, unsurprisingly. Nor is the disruptive nature of this deal a shocker. History says that tech markets are prone to disruption and tech investors do best when they're patient, as David Gardner has been. He produced a decade of 20% returns in the real-money Rule Breaker portfolio. Tom Gardner's "simpleton portfolio" was also a 10-year winner. I believe that these five tech stocks will help me achieve similar success.

There's your checkup. See you back here next week for more tech-stock talk.

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