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EMC Corporation Message Board

  • whynot327 whynot327 Sep 15, 2004 8:31 AM Flag

    Goldman Lowers IT Hardware/Systems

    IT Hardware/Systems:
    Reducing Ests and Cov View
    in the Face of Moderate 05
    We are reducing our coverage view from Attractive to Neutral and lowering our
    2005 (and in a few cases, 2004) rev and EPS est's as we anticipate slower growth for
    tech in 2005. Looking at our numbers in context of overall tech capital spending and
    each company's exposure to faster growing product categories and geographic end
    markets, our new ests are likely more indicative of current market conditions where
    we look for tech cap spending to be in the 3-5% range in 2005. For the most part, our
    rev revisions were deeper than the cuts to our EPS. The only two large cap
    companies we have left unchanged are Dell and IBM. Even amidst what appears to
    be a decelerating tech environment, 4Q04 seasonality could still prove to be a
    familiar catalyst for many of the stocks, and we fully expect to see at least some form
    of rally. For investors looking to incorporate a weaker view on 2005, we would
    recommend large cap franchise names with both defensive and offensive
    characteristics and highlight DELL, EMC, and IBM.

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