16th February 2016, 08:59
Technological megatrends promise even in turbulent times growth. According to DNB, the prices of tech stocks should increase by 2016 eight to ten percent. With targeted stock picking can be chances to improve. Some titles such as SAP or Oracle are particularly well positioned in the race for the highest returns.
The new year is also technology stocks unsuccessful. The tech-heavy Nasdaq composite Index lost since the start of an around ten percent of its value. Positive side effect: in the course of correcting the ratings have fallen back to the historical average Latest technology stocks are trading at a price-earnings ratio of 16 in the sector comparison technology, putting it in the middle, “If the growth prospects and the strong cash flow of the established players… sees the assessment is very fair, “says Anders Tandberg-Johansen, Manager of DNB technology Fund. the high cash flow should again attract investors. Tandberg-Johansen says 2016 though a volatile but profitable year for equities ahead. He expects technology shares under the bottom line, however, with increases of eight to ten percent.
Technological megatrends identify
Increase can be the performance with targeted stock picking. The DNB Technology Fund has brought by a targeted selection over the last five years a return of 14 percent per year into being and thus placed at the top of all global TMT Fund.
In order selection in the vast technology optimize universe, the team of DNB has identified six technological megatrends. These trends provide largely independent of economic fluctuations in the long term for high growth rates. Specifically, these are the further spread of the Internet (also and especially in emerging markets), the combination of objects to the Internet (the so-called Internet of Things), the fragmentation of the TV via providers like Netflix, Apple TV or Amazon, digitization financial services (keyword Fintech) Cypersecurity and cloud computing.
“the time was in the discussion even if more and more data and services will be relocated to the cloud, is over. Cloud Computing has arrived in the present. Now is discussed, who are the winners and losers of the trend toward cloud computing, “says Mikko Ripatti, Senior Portfolio Manager at DNB. Among the winners DNB Oracle and SAP. This long-established IT companies are excellently positioned in this trend and are characterized by high profitability moreover, great innovative strength and low valuation. Oracle is traded for example, with a price-earnings ratio of twelve.
The high ratings however are a reason why DNB is currently invested in Megatrend Cypersecurity. Nevertheless Cypersecurity remains a highly interesting business area. More and more sensitive data migrate to the Internet. Alone in Facebook 1.5 billion votes are registered, 1.4 billion people use Android. increasingly also companies and authorities are outsourcing data. “The growth potential is large, but the ratings are too high and we are very disciplined in our approach,” says Ripatti
Page two:. The disruptive force in the industry is attractive
the disruptive force in the industry is attractive
in the investment approach of DNB-tech teams are full coffers and strong cash flows in the foreground. Trends are important, but castles in the air are not purchased. This focus on profitability has prevailed throughout the IT industry. Powers during the Dot.com bubble only 50 percent of technology companies profits, there are currently more than 90 percent. In addition, the tech giant hoard loads of cash. In Apple collect 140 billion dollars Google has 70, Facebook added $ 20 billion the page.
The technology sector is particularly attractive due to their disruptive force. Digitizing or new organization of many services provides entire industries upside down. Technological change just breaking over the financial sector in. The former CEO of Barclays, Antony Jenkins, said for the Financial Industry already a “Uber-moment” before. Uber sets with its disruptive service the taxi industry under significant pressure. In hot topic Fintech but mix less great, because numerous small players in the traditional structures. More than a thousand companies are active in Fintech area. “Things are extremely much. The small companies can be broken with advanced technology in specific segments through “, says DNB expert Ripatti.
The regulation is a risk
Full changing is the media world. Norwegian children already spend more time online than watching TV. Youtube is already the largest TV station in the US. Selective View on “Video on Demand” is announced. “The consumer can decide what content he sees when he sees them and on which device. These are the killer apps “says Ripatti. Netflix or Amazon Prime are the largest suppliers. You benefit from the trend towards fragmentation of the TV business.
In most trends very well positioned alphabet, the Holding is one of not only Youtube but also Google. This circumstance and not exaggerated high evaluation help the search engine giant to technology-Depot of DNB. As the largest risk DNB sees the regulation. Particularly from the European Union threatens headwind.
More about technology stocks
The technology industry is not only traditional industries to the head, but changing yourself. Last alphabet Apple had briefly as the most valuable publicly traded company replaced. The iPhone maker fell through with investors last year. The paper lost within a year nearly 30 percent of its value. Although the market for iPhones seems saturated, and Apple’s dependence on mobile phones (2/3 of sales) is large, the Group is characterized by a strong brand, high cash reserves and particularly large scale effects. (Tr)