logo
  Join        Login             Stock Quote

Seven Bear Stocks In Technology, Media And Telecommunications

 September 16, 2010 11:20 AM
 


In this article, I will pick seven bear stocks in the TMT index. Since TMT index is composed of 40 Technology, 23 Media, and 37 Telecommunications stocks, our portfolio composition is fixed at 3:1:3::T:M:T.

Media stock - Gannett Co., Inc. (NYSE: GCI)

Gannett is the largest newspaper publisher in the U.S. GCI's current stock price is in the band of $13.2 and $13.47, compared to 52 week band of $9.03 and $19.69. Though, I calculate its intrinsic stock value to be more than $14, I am apprehensive about the performance of the stock due to its debt burden. There were some other stocks that competed to be included in this portfolio but they were rejected as they were not part of NYSE TMT index.

Technology stocks – NOVL, RHT, and QSFT

Novell, Inc. (NASDAQ: NOVL)

NOVL's current stock price is trading in the band of $5.85 and $5.92, compared to 52 week band of $3.84 and $6.36. However, I calculate its intrinsic stock value to be less than $1. In terms of ROE, it is the worst performer among its peers.

NOVL relies on a series of alliances and partnerships to drive sales growth; its partners include IBM, HP, Dell, Intel, Oracle, SAP, AMD, CA, EMC and Adobe. NOVL believes it has created an ecosystem around it to combine its strengths with those of its partners; however, these partners are also counted among the strategic partners of many other software firms, and so I doubt the partnerships to provide a significant competitive advantage.

Red Hat, Inc. (NYSE: RHT)

RHT's current stock price is in the band of $38.01 and $38.79, compared to 52 week band of $24.73 and $39.08. However, I calculate its intrinsic stock value to be less than $25. Moreover, in terms of ROE, it is among the worst performers among its peers.

Although I believe RHT is benefiting from increased adoption of virtualization near term, I think RHT will lose market share as more companies standardize their IT infrastructure with the market leader VMware.

Quest Software, Inc. (NASDAQ: QSFT)

QSFT's current stock price is in the band of $22.8 and $23.26, compared to 52 week band of $15.16 and $23.85. Though, I calculate its intrinsic stock value to be more than $28, I am apprehensive about the performance of the stock due to its margin compressions, and patent wars with Centrify Corp.

Next Page >>12
iOnTheMarket Premium
Advertisement

Advertisement


Comments Closed


rss feed

Latest Stories

article imageRussell 2000 Showing Relative Weakness at the New Highs

A quick “Quad Index” Grid shows us that the small-cap Russell 2000 is showing relative strength to the read on...

article imageThe Poster Boy For Liberal Economics Discovers The Tax Factor

Paul Krugman seems to be having a supply-side-economics moment… sort of. Raising taxes, the NY Times read on...

article imageMacroprudential Policy And Distribution Of Risk

There is very little doubt that housing prices and leverage played a strong role in the global financial read on...

article imageIs the World Turning Japanese?

Many really think so, but reality suggests read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.