Is it time to hop on the commodities bandwagon?
What Morningstar's analysts are hearing from mutual fund managers about tech..
What Morningstar's analysts are hearing from mutual fund managers about technology.
Large-cap portfolio managers are buzzing about technology. Leaders of tech companies are wiser today than they were in the dot-com era, fund managers say. They're conserving cash, limiting debt, and making smarter acquisitions. On average, tech-stock valuations are attractive after a decade of weak returns. The typical tech-stock fund lost 5% annualized during the past decade, while the S&P 500 was flat.
* For the most part, American Funds is in character. Although Apple remains a popular holding at the family, most of the funds have been trimming it. On the flip side, they've been adding to Google, one of the tech sector's harder-hit stocks. There's less of a consensus on Microsoft, however. Several funds, including New Economy
* T. Rowe Price Growth Stock
* Jeff Constantino, who runs MFS Massachusetts Investors Growth Stock
"My biggest mistake on Apple was not buying it at $3 or $4 10 years ago. Now, it's a conundrum. It's trading at 85% the market cap of ExxonMobil, but it won't come close to ExxonMobil on cash flow. A lot is needed to move it higher."
Bill Miller, Legg Mason Capital Management Value Trust
"Odds are it's going higher. The iPad gives it an added leg of growth. The valuation isn't extreme yet, but it is a crowded stock."
Nick Thakore, Putnam Voyager
"It's too quick to say [Microsoft is] on death's door. If its only business was desktop software, it'd be in trouble. But there are other levers here, too. Having said that, it's becoming clearer to more and more people that a lot of these guys should start behaving like industrial companies. They need to think about how to allocate capital."
Robert Hagstrom, Legg Mason Capital Management Growth Trust
"We think IBM can support double-digit earnings growth. Add that to its dividend yield, [share] buybacks, and valuation, and we think it's a good buy."
Marc Pinto, Janus Growth & Income