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Garnry: Why I've still got high hopes for tech
Earnings season is heating up, with more than 80 companies reporting results this week. According to Saxo Bank's Peter Garnry, it's the technology sector that will stand out. He particularly thinks IBM and Google will do well.
The first two quarters of the year may have been disappointing for US technology companies in terms of growth, but Peter explains that analysts have high hopes for the sector in Q3.
That said, first in line to report is Intel (INTC:xnas) - out on Tuesday - but it's expected to report a 9.5 percent decline from last year. This is mainly do to the fact that the "revolution" in mobile devices is having a negative impact on Intel's profitability.
But IBM (IBM:xnys) - which reports on Wednesday - is expected to be up 9.2 percent from last year. Peter thinks that from an investment point of view, IBM is a "phenomenal IT company". However, he does warn, that with 60 percent of revenue coming from outside the Americas region, the headline figure could come in weaker than estimated given the weak global economy six months ago.
And finally, Google (GOOG:xnas) - out on Thursday - is expecting to be up by a whopping 40.9 percent from last year. Google is "firing on all cylinders", according to peter, with YouTube's business model now in full speed, and advertising budgets still being diverted to online, which is boosting its Adwords business.
Read more about Peter's predictions here:
http://www.tradingfloor.com/posts/weeks-earnings-google-goldman-sachs-bofa-ibm-citi-1615755134
01:53 minutes
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