S&P Equity Research Issues Tech Sector Predictions for 2011
NEW YORK, Jan. 4, 2011 /PRNewswire/ -- S&P Equity Research is looking for slower growth in the technology sector in 2011, compared to 2010, but still believes the growth will be healthy. The S&P tech equity analysts and strategists have a positive fundamental outlook and overweight recommendation on the sector.
"We expect notable developments regarding new products, international activity, and M&A deals," said Scott Kessler, Information Technology analyst and tech sector group head at S&P Equity Research.
Following are select predictions for the tech sector from industry analysts at S&P Equity Research for 2011.
1. We think Intel (NNM: INTC 21 ****) will finally gain some traction in the handset and tablet markets.
2. We forecast that global solar system installations will increase at least 20% in 2011, well below our 2010 estimated growth rate of a two-fold increase.
3. We expect solar manufacturers that have a greater proportion of sales devoted to the U.S. to outperform peers.
4. We project 2011 to show a continuation of the computer hardware recovery since the deep cyclical trough of 2009. We project global PC unit shipments to rise 14% in 2011, after an estimated rise of 17% for 2010.
5. Computer hardware should continue to make inroads into new markets such as self-serve kiosks in the transportation, healthcare and retail areas, based on an ongoing desire to automate transactions and offer consumers more ways to handle business.
6. We see the wide-spread emergence of visualization and cloud infrastructures requiring improved integration of datacenter switches and servers with more advanced delivery functionality. We believe companies with strong application delivery and WAN optimization capabilities, such as F5 Networks (NNM: FFIV 134 ***) and Riverbed Technology (NNM: RVBD 38 ***) will be attractive acquisition candidates for 2011.
7. We believe Microsoft (NNMS:MSFT 28 ***) will continue to lose market share in smartphones, as Windows Phone 7 fails to capture the interest of consumers.
8. We expect sales in the video game industry will be slightly up in 2011, after declining for the two prior years, driven by strong sales of Microsoft Kinect.
9. Consolidation in the data storage industry should continue in 2011, by our analysis, with most of the M&A activity being centered on storage software, as opposed to hardware.
10. We expect sales of tablet computers to surge and begin to cannibalize sales of netbooks and mini notebooks.
11. Despite having less functionality than tablet computers, sales of e-book readers will continue to surge in 2011, in our view. We see unit sales increasing from 7 million in 2010 to 11 million in 2011, led by Amazon.com's (NNM: AMZN 184 ***) Kindle.
12. We expect to see at least one major strategic move from an IT services company that caters to the Department of Defense. Companies in this category include ManTech (NNM: MANT 42 ***) and SAIC (NYSE: SAI 16 ***). .
13. Despite continuing revenue growth, the major India-based IT outsourcers, including Infosys (NNM: INFY 78 ***) and Wipro (NYSE: WIT 16 ***) should experience margin declines in 2011.
About Standard & Poor's Equity Research Services
As the world's largest producer of independent equity research, Standard & Poor's licenses its research to global institutions for their investors and advisors. Standard & Poor's team of experienced U.S., European and Asian equity analysts use a fundamental, bottom-up approach to assess a global universe of multi-asset class securities across industries worldwide. Follow Standard & Poor's equity analysts' U.S. market commentary each day at http://www.equityresearch.standardandpoors.com/.
The equity research reports and recommendations provided by Standard & Poor's Equity Research Services are performed separately from any other analytic activity of Standard & Poor's. Standard & Poor's Equity Research Services has no access to non-public information received by other units of Standard & Poor's. Standard & Poor's does not trade for its own account. The analytical and ethical conduct of Standard & Poor's equity analysts is governed by the firm's Research Objectivity Policy, a copy of which may also be found at www.standardandpoors.com or by clicking here.
About Standard & Poor's
Standard & Poor's Financial Services, LLC, a subsidiary of The McGraw-Hill Companies (NYSE: MHP), is the world's foremost provider of independent credit ratings, indices, risk evaluation, investment research and data. With offices in 23 countries and markets, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit www.standardandpoors.com.
For more information contact: |
|
All information provided by Standard & Poor's is impersonal and not tailored to the needs of any person, entity or group of persons. Past performance is no indication of future results. Standard & Poor's and its affiliates provide a wide range of services to, or relating to, many organizations, including issuers of securities, investment advisers, broker-dealers, investment banks, other financial institutions and financial intermediaries, and accordingly may receive fees or other economic benefits from those organizations, including organizations whose securities or services they may recommend, rate, include in model portfolios, evaluate or otherwise address.
This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue. Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested. Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate. Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor. The information contained in this report does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation of particular securities, financial instruments or strategies to you nor is it considered to be investment advice. Before acting on any recommendation in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice.
This material is based upon information that we consider to be reliable, but neither S&P nor its affiliates warrant its completeness, accuracy or adequacy and it should not be relied upon as such. With respect to reports issued to clients in Japan and in the case of inconsistencies between the English and Japanese version of a report, the English version prevails. With respect to reports issued to clients in German and in the case of inconsistencies between the English and German version of a report, the English version prevails. Neither S&P nor its affiliates guarantee the accuracy of the translation. Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice. Neither S&P nor its affiliates are responsible for any errors or omissions or for results obtained from the use of this information. Past performance is not necessarily indicative of future results.
SOURCE Standard & Poor's
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article