Welcome to week 55 of my stock-picking throwdown with Mr. Market. Let's get right to the numbers:
Company |
Starting Price* |
Recent Price |
Total Return |
---|---|---|---|
Akamai |
$22.23 |
$18.11 |
(18.5%) |
Harris & Harris |
$6.22 |
$6.09 |
(2.1%) |
IBM |
$126.39** |
$118.22 |
(6.5%) |
Oracle |
$22.64** |
$22.16 |
(2.1%) |
Taiwan Semiconductor |
$9.81** |
$10.78 |
9.9% |
AVERAGE RETURN |
-- |
-- |
(3.86%) |
S&P 500 SPDR |
$123.67** |
$103.38 |
(16.41%) |
DIFFERENCE |
-- |
-- |
12.55 |
Source: Yahoo! Finance.
*Tracking began on Aug. 7, 2008.
**Adjusted for dividends and other returns of capital.
The backslide continues: My tech portfolio lost 75 basis points in week three of year two of this thee-year race. I'm still confident that I'll win, but I'd be lying if I told you I wasn't nervous -- no sane investor ever likes to lose to the index, even over the very short term.
Winning could become more difficult thanks a slew of artificial stimulus that's obscuring the real risk level in industries that drive U.S. economic growth, such as health care and financial services. Health care in particular is a problem. A contentious debate over reform has increased the risk of holding stocks such as Aetna
Financial services firms such as Citigroup
But reputations aren't all that needs repairing when it comes to the big banks. Balance sheets also remain a problem -- a problem that could soon get worse. The FDIC last week said it was short on cash, even as it faces a slew of new small bank failures. Citigroup, JPMorgan Chase
Hey, someone has to pay the price.
The week in tech
Meanwhile, in the tech sector, the news could hardly be better. Dell
More importantly, CEO Michael Dell said in a statement that technology buyers are starting to come back: "If current demand trends continue, we expect revenue for the second half of the year to be stronger than the first half."
Research backs up that claim. Moody's Investors Service now projects that corporate spending on PCs and other technology hardware will improve due to the "aging of the installed base," a good sign for Dell and new entrant Accenture
Meanwhile, in the hypergrowth smartphone market, China Mobile
How soon Apple will reap profits from this deal is unclear, but that's fine. History says that 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 with these five tech stocks, I will achieve similar success.
Checkup time!
Now let's move on to the rest of today's update:
- Shares of Akamai competitor Limelight Networks took a beating on Friday, falling 9%, after a Raymond James analyst downgraded the stock on pricing pressure from Akamai and venture-backed peers such as BitGravity and EdgeCast.
- Oracle's acquisition of Sun Microsystems can't close soon enough. The server maker reported a $0.20 per share loss in its fiscal fourth quarter. Revenue declined 31%.
- SPSS has set Oct. 2 as the date for a special meeting in which the company's board will ask shareholders to approve a $1.2 billion sale to IBM.
There's your check-up. See you back here next week for more tech stock talk.
Get your clicks with more techie Foolishness:
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- Mr. Softy still has a taste for the jugular.