<% ' AvantGo:MarketClose %>DJIA 9056.05 +14.94 (+0.17%) S&P 500 1152.61 +8.13 (+0.71%) Nasdaq 1919.68 +22.24 (+1.17%) Value Line ndx 887.87 +5.57 (+0.63%) 30-Year Bond 100 4/32 +9/32 5.24% Yield<% ' AvantGo:End %>
<% ' AvantGo:Heroes %>Printed circuit board manufacturer Hadco Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: HDCO)") else Response.Write("(Nasdaq: HDCO)") end if %> picked up $3 1/4 to $35 1/4 on expectations the company may pull a rabbit out of its financial hat and top analysts' estimates with its fiscal fourth quarter results, which are expected on Nov. 24. After Merrill Lynch forecasted in a research note last week that the company's outlook is looking brighter due to a recent pickup in orders (the industry's book-to-bill ratio, published by trade group IPC, surpassed 1.0 in July of this year -- September's BTB ratio was 1.08), further positive incremental information was provided today from BancBoston Robertson Stephens and Advest. Apparently, analysts at both brokerages believe the company's Q4 ended very strongly and will produce results closer to breakeven than the loss of $0.06 per share forecast by analysts surveyed by First Call. A break-even quarter was just what the company had been shooting for all along, as a Hadco executive told Greg Markus (TMF Boring) in a recent interview.
Consumer electronics retailer Tweeter Home Entertainment Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: TWTR)") else Response.Write("(Nasdaq: TWTR)") end if %> rose $2 5/16 to $17 3/4 after reporting better-than-expected Q4 results. Revenue rose 22.3% to $53.5 million on the strength of a 15.3% increase in overall comp-store sales. The firm's New England-based Tweeter stores saw same-store sales increase 17.9%, while its Mid-Atlantic Bryn Mawr group (acquired in May 1996) enjoyed a 25.7% same-store gain, and the Atlanta-based HiFi Buys (acquired in May 1997) saw a 6.3% increase. As a result, net income before extraordinary charges was $1.08 million versus a loss of $0.46 million a year ago. That was good for $0.16 per share ($0.11 after charges), up from a loss of $0.70 per share last year and ahead of the three-analyst consensus estimate of $0.09 per share. More details can be found in today's Fool Plate Special.
QUICK TAKES: Semiconductors and digital signal processing (DSP) devices maker Texas Instruments <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TXN)") else Response.Write("(NYSE: TXN)") end if %> tacked on $4 7/8 to $77 1/8 after BancBoston Robertson Stephens raised its rating to "strong buy" from "buy," citing developments in the DSP sector that could boost the company's share in that market to 60%-70% from its current share of about 45%... Radio station operator Clear Channel Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CCU)") else Response.Write("(NYSE: CCU)") end if %> advanced $2 7/16 to $49 7/16 after the company and merger partner Jacor Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: JCOR)") else Response.Write("(Nasdaq: JCOR)") end if %> said they will sell 20 radio stations to gain regulatory approval of their proposed combination. The number is lower than the 23 stations some analysts had expected the companies to part with... Cable TV network operator and publisher Time Warner <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TWX)") else Response.Write("(NYSE: TWX)") end if %> climbed $7 1/8 to $106 after setting a two-for-one stock split effective Dec. 15.
Telecommunications giant MCI WorldCom <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: WCOM)") else Response.Write("(Nasdaq: WCOM)") end if %> rang up $3 9/16 to $58 7/8 after announcing it will launch a nationwide, ultrafast Internet access service via traditional copper phone lines and sell it directly to small businesses and Internet service providers... Cellular and personal communications services (PCS) devices chipsets maker DSP Communications <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DSP)") else Response.Write("(NYSE: DSP)") end if %> added $2 3/16 to $13 1/8 thanks to a NationsBanc Montgomery Securities upgrade to "buy" from "hold"... Israeli telecommunications and defense electronics equipment developer Tadiran Ltd. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TAD)") else Response.Write("(NYSE: TAD)") end if %> added $3 1/4 to $35 3/4 after Israeli investment holding company Koor Industries <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KOR)") else Response.Write("(NYSE: KOR)") end if %> raised its cash buyout offer for the firm to $36 3/8 per American depositary share from $31.15 per share. Koor rose $3/4 to $17 7/8.
Pharmaceutical research products maker CN Biosciences <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CNBI)") else Response.Write("(Nasdaq: CNBI)") end if %> advanced $1 7/16 to $24 9/16 after agreeing to be acquired by a unit of Germany's Merck KGaA for $150 million in cash, or $25 per share... Measurement, color printing, and video and networking firm Tektronix Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: TEK)") else Response.Write("(NYSE: TEK)") end if %> moved up $3 7/16 to $24 after Merrill Lynch started coverage of the company with a near-term and long-term "buy" rating. Merrill said the firm's shares are undervalued considering its leading position in the market for laser quality desktop color printers and its lineup of "blockbuster" new products... Visual effects and editing software firm Discreet Logic <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DSLGF)") else Response.Write("(Nasdaq: DSLGF)") end if %> rose $1 1/16 to $13 15/16 after CAD/CAM software maker Autodesk <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ADSK)") else Response.Write("(Nasdaq: ADSK)") end if %> readjusted the terms of the companies' merger agreement, reducing the amount of Autodesk shares that Discreet's shareholders will receive but also reiterating Autodesk's commitment by raising the termination fees for backing out of the deal.
Men's business attire retailer Men's Wearhouse <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SUIT)") else Response.Write("(Nasdaq: SUIT)") end if %> scooted up $1 1/2 to $26 3/4 after agreeing to buy privately held men's apparel retailer Moores Retail Group Inc. for up to $127 million in stock and assumed debt... Consumer services firm Cendant Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CD)") else Response.Write("(NYSE: CD)") end if %> ascended $1 1/16 to $14 7/16 on rumors that the company is considering the sale of certain assets, including portions of its software businesses... Disk drive maker Western Digital <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: WDC)") else Response.Write("(NYSE: WDC)") end if %> gained $1 7/8 to $14 13/16 as the market may have been digesting recent positive incremental information suggesting the drive industry is seeing a pickup in orders, possibly prompting short-sellers to cover their positions... Enterprise network security systems firm Secure Computing <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SCUR)") else Response.Write("(Nasdaq: SCUR)") end if %> added $1 7/8 to $20 1/4 after BancBoston Robertson Stephens raised its rating to "buy" from "long-term attractive," based in part on confidence that the firm's new products are gaining market acceptance.
Industrial piping systems construction and maintenance firm The Shaw Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SGR)") else Response.Write("(NYSE: SGR)") end if %> moved up $1 1/16 to $9 7/16 after the company boosted its current stock buyback plan to cover 20% of its outstanding shares, up from the 10% authorized in August... Custom computer systems manufacturer Dunn Computer Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DNCC)") else Response.Write("(Nasdaq: DNCC)") end if %> rose $2 1/32 to $6 3/32 after the U.S. Navy awarded the company a $6 million contract for 4,000 custom computer workstations... Client/server, intranet, and Internet-based recruiting services firm Restrac Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RTRK)") else Response.Write("(Nasdaq: RTRK)") end if %> gained $2 5/16 to $7 11/16 after buying the Junglee Employment Services business from online retailer Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %> for about $15 million in cash and stock. Separately, Amazon fell $10 3/4 today to $153 1/4.
Earnings Movers
Catherines Stores Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: CATH)") else Response.Write("(Nasdaq: CATH)") end if %> up $1/2 to $11 1/2; Q3 EPS: $0.22 vs. $0.01 last year; Estimate: $0.16
Culp Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CFI)") else Response.Write("(NYSE: CFI)") end if %> up $5/8 to $8 1/4; fiscal Q2 EPS: $0.10 vs. $0.35 last year; Estimate: $0.02
Gerber Scientific <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GRB)") else Response.Write("(NYSE: GRB)") end if %> up $3 11/16 to $23 15/16; fiscal Q2 EPS: $0.33 vs. $0.24 last year; Estimate: $0.32
Sterling Software <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SSW)") else Response.Write("(NYSE: SSW)") end if %> up $1 1/4 to $26 1/16; fiscal Q4 EPS: $0.43 (excluding charges) vs. $0.29 last year; Estimate: $0.42<% ' AvantGo:End %>
<% ' AvantGo:Goats %>RealNetworks <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RNWK)") else Response.Write("(Nasdaq: RNWK)") end if %> tuned out after Microsoft's <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MSFT)") else Response.Write("(Nasdaq: MSFT)") end if %> announcement late yesterday that it would begin selling its roughly 10% non-voting stake in the developer of Internet audio and video streaming software today on the open market. RealNetworks sank $4 3/4 to $38 1/8 on the news. Microsoft said the two partners couldn't agree to the terms of a joint secondary offering, and that "the rapid pace of innovation and our competing visions for streaming media means our investment in RealNetworks no longer makes sense." RealNetworks' CEO Rob Glaser said the divestiture would have no impact on his company, which has an 85% share in the Web streaming media market. Yesterday, RealNetworks said it will continue to make its products work well with Microsoft's products. For more, see today's Breakfast With the Fool.
Third-party billing clearinghouse Billing Concepts <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: BILL)") else Response.Write("(Nasdaq: BILL)") end if %> lost $3 13/16, or 23.7%, to $12 1/4 today after reporting fiscal fourth quarter earnings of $0.20 a share (before charges), $0.02 above last year's number and in line with the consensus of eight analysts surveyed by First Call. However, after a special $2 million charge for research and development (R&D) costs related to the acquisition of a 22% stake in Princeton TeleCom Corp., the company's EPS dropped to $0.14. The company also announced it will acquire privately held Communications Software Consultants, a telecommunications software and consulting company, for about 2.5 million shares of company stock, or about $39.9 million based on yesterday's closing price of $16 1/16.
QUICK CUTS: American Airlines parent AMR Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AMR)") else Response.Write("(NYSE: AMR)") end if %> dropped $1 5/8 to $63 1/8 after signing an agreement to buy Reno Air <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: RENO)") else Response.Write("(Nasdaq: RENO)") end if %> for $7.75 per share in cash, about a 7% premium over Reno's Wednesday closing price of $7.25 per share... Meanwhile, Delta Air Lines <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DAL)") else Response.Write("(NYSE: DAL)") end if %>, cut to "outperform" from "buy" by Salomon Smith Barney, dipped $1 13/16 to $52 3/8. Elsewhere in the airline sector, United Airlines parent UAL Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: UAL)") else Response.Write("(NYSE: UAL)") end if %> fell $3 15/16 to $64 1/16, Northwest Airlines <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: NWAC)") else Response.Write("(Nasdaq: NWAC)") end if %> shed $1 5/16 to $23 1/16, U.S. Airways <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: U)") else Response.Write("(NYSE: U)") end if %> lost $2 7/16 to $48 1/16, and Southwest Airlines <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: LUV)") else Response.Write("(NYSE: LUV)") end if %> slid $1 1/16 to $21 1/2... Cable and telecommunications company MediaOne Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: UMG)") else Response.Write("(NYSE: UMG)") end if %> tumbled $1 9/16 to $37 7/8 after Salomon Smith Barney lowered its rating to "outperform" from "buy."
Biotech company Amgen <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMGN)") else Response.Write("(Nasdaq: AMGN)") end if %> was cut $2 3/16 to $77 1/16 on news it may stop developing a once-a-week version of its blockbuster anemia drug Epogen if it loses a battle with drug and healthcare products maker Johnson & Johnson <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: JNJ)") else Response.Write("(NYSE: JNJ)") end if %> over rights to the treatment... Heavyweight manufacturer of printers, workstations, PCs, and medical and industrial metrology equipment Hewlett-Packard <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HWP)") else Response.Write("(NYSE: HWP)") end if %> slid $15/16 to $58 7/8 after saying it is cutting prices by up to 12% on three of its workstations amid falling chip prices... Foot Locker and Champs stores operator (and recent Daily Trouble) Venator Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: Z)") else Response.Write("(NYSE: Z)") end if %> ran down $1 to $9 after it reported losses from continuing operations of $0.29 per share, a nickel below analysts' projections and well off last year's $0.37 per share profit. Check out a recent StockTalk interview with Venator's VP of Investor Relations.
Information databases firm Dialog Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DIALY)") else Response.Write("(Nasdaq: DIALY)") end if %> American depositary receipts plunged $4 3/4, or 42.7%, to $6 3/8 after posting a lower-than-expected Q3 earnings as it attracted fewer subscribers and use of its service slowed... Laser beam mask making equipment maker Etec Systems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ETEC)") else Response.Write("(Nasdaq: ETEC)") end if %> burned off $2 15/16 to $28 1/16 after saying it anticipates fiscal 1999 revenues flat with 1998 levels and earnings 30% to 40% below last year's $2.05 per share. Fiscal Q1 EPS of $0.43 was $0.02 above both last year's mark and the Street's consensus... Senior residential and healthcare services provider American Retirement Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ACR)") else Response.Write("(NYSE: ACR)") end if %> pulled back $1 to $16 1/4 after agreeing to buy rival Assisted Living Concepts <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ALF)") else Response.Write("(NYSE: ALF)") end if %> for about $500 million in stock and assumed debt.
Satellite communications company PanAmSat Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SPOT)") else Response.Write("(Nasdaq: SPOT)") end if %> fell $4 9/16 to $37 1/8 after it said in a SEC filing that possible future interruptions to service "could result in a claim by affected customers for termination of their transponder agreements." PanAmSat is 81% owned by General Motors subsidiary Hughes Electronics <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GMH)") else Response.Write("(NYSE: GMH)") end if %>... Power conversion circuit manufacturer Power Integrations <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: POWI)") else Response.Write("(Nasdaq: POWI)") end if %> drained $1 1/2 to $21 3/8 after Hambrecht & Quist lowered its rating on the company to "buy" from "strong buy"... Electronic scoreboards maker Daktronics Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DAKT)") else Response.Write("(Nasdaq: DAKT)") end if %> dropped another $2 to $11 3/8 after reporting fiscal Q2 EPS of $0.19, same as last year... Home improvement retailer HomeBase Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: HBI)") else Response.Write("(NYSE: HBI)") end if %> was hammered down $1 1/8 to $6 1/2 after it reported Q3 EPS of $0.17, a penny better than last year's pre-charge figure and flat with the consensus estimate of four analysts.
Discount retailer Consolidated Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: CNS)") else Response.Write("(NYSE: CNS)") end if %> fell $11/16 to $20 1/8 after Bear Stearns lowered its rating on the company to "neutral" from "attractive"... Tour bus manufacturer Metrotrans Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MTRN)") else Response.Write("(Nasdaq: MTRN)") end if %> braked $1 1/16 to $5 15/16 after it delayed the filing of its Q3 earnings to no later than Monday. One analyst surveyed by First Call expects EPS of $0.20, $0.03 below last year's figure... Hibbett Sporting Goods <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: HIBB)") else Response.Write("(Nasdaq: HIBB)") end if %> was batted down $2 15/16 to $30 9/16 after it announced Q3 EPS of $0.27, higher than last year's $0.21 but flat with market projections... Optical thin film coated component maker Optical Coating Laboratory <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: OCLI)") else Response.Write("(Nasdaq: OCLI)") end if %>, whose products are used to manage light in photocopiers, fax machines, and other devices, cracked $3/4 to $18 1/8 after it said it expects an after-tax Q4 loss of $0.29 per share due to the sale of its MMG glass fabrication assets to a Swiss company... Supply chain management software developer Manugistics Group <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MANU)") else Response.Write("(Nasdaq: MANU)") end if %> lost $1 5/8 to $10 after Prudential Securities lowered its rating on the company to "hold" from "accumulate."<% ' AvantGo:End %>
FOOL
ON THE HILL
An Investment Opinion
by
Dale Wettlaufer
What Is a Tech Stock?
<% ' AvantGo:FOTH %>With the Nasdaq index and Internet stocks going nuts recently, eliciting headlines like "Tech Stocks Hurdle Ahead," I thought the nature of tech stocks and the mischaracterization of them deserves another visit in this space.
What is a tech stock after all? It seems that anything with four letters in the trading symbol and sequential revenue growth rates of 10% or more qualifies as a tech stock to many observers. And I'm not being hyperbolic in making that statement, either. A better definition might be a company that sells products with high intellectual property content or high value-added or whose revenues are mainly the result of applied scientific research and development.
For instance, take Pfizer <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PFE)") else Response.Write("(NYSE: PFE)") end if %>. Why does nobody say, "Tech stock Pfizer rocketed ahead today," when this company spends billions of dollars per year on research and development. Last year Pfizer spent $1.93 billion on R&D, about 82% of what tech stock king Intel <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: INTC)") else Response.Write("(Nasdaq: INTC)") end if %> spent in fiscal 1997. As a percentage of sales, that's 9.3% for Intel versus 15.8% for Pfizer. Looking at how much a company spends on R&D as a percentage of revenue, Pfizer is much more the high-tech oriented company than is Intel.
Sure, shooting electrons across circuits 3.6 one-thousandths the width of a human hair sounds pretty neat, but so is successfully sending a couple of hundred milligrams of active drugs into a 100,000,000 milligram human body to hunt down and kill a disease. The yearly R&D necessary to turn out a relative handful of blockbuster drugs per decade costs as much and necessitates as many or more skilled scientists to push ahead as does a dominant semiconductor company.
Measuring by margins who adds more value is trickier, though. Semiconductor companies are more capital intensive than pharmaceutical companies, so the costs associated with turning out the products are larger, as a percentage of revenues, than for the pharmaceuticals industry. Intel last year generated a 60.3% gross margin while Pfizer spent less than 20 cents per sales dollar to turn out its goods. The easiest conclusion to make would be that Pfizer adds more value to its products, but does the cost of goods sold for a pharmaceutical company really capture the investment needed to produce those revenues? I would argue not. If the industry were to capitalize its long-term investments in drug development programs, the gross margin would be lower as operating expenses actually move up into the cost of goods sold line.
In any case, both Intel and Pfizer add value to their products and show operating margins that reflect the high value-added content. Last year Intel achieved an operating margin of 39.4% while Pfizer reported an operating margin of 25%. Not that that's always the best indication of high-tech. Look at Boeing <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BA)") else Response.Write("(NYSE: BA)") end if %>. Is this a tech stock? You had better hope so when you're 38,000 feet up in a 777 and one of engines goes out. The intellectual property content in commercial aircraft is huge. But when you happen to only make a couple of hundred planes per year, the leverage on manufacturing them isn't ridiculously good and the number of planes needed to cover the spread-out expenses of developing a plane is pretty high. The 747 is a high-margin aircraft, as far as these things go, because the main development costs were covered long ago and there is no long-range wide body that does everything the 747 will do. So even though commercial aviation design and manufacturing is a capital intensive business with not-so-great margins or asset turnover, it's still a high-tech industry.
The worst example of a company characterized as "high-tech" that I've ever heard is Amazon.com <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AMZN)") else Response.Write("(Nasdaq: AMZN)") end if %>. Amazon.com is a consumer of high-tech products, not a producer. Sure, it has some software units, but the overwhelming majority of the company's revenues are generated by retail sales. Amazon.com is a retailer where you just happen to shop using a different medium than actually driving to the store. Technology is an input, not an output, at Amazon.com. If we were to characterize firms as tech companies by their spending on inputs, Procter & Gamble <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: PG)") else Response.Write("(NYSE: PG)") end if %> would be considered a high-tech company with all of its spending on enterprise resource planning software and systems and tens of thousands of PCs/
Speaking of that, the PC industry really isn't that high-tech, anyway. Where does the value-added come from in a PC? It's the operating system and the CPU. A company like Dell <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DELL)") else Response.Write("(Nasdaq: DELL)") end if %> spends very, very few sales dollars on R&D. Dell is a precision manufacturer whose process engineering puts the rest of its peers to shame. Its value-added comes from its ability to service customers and not from products that are pretty much the same as everyone else's. Dell makes money because it knows how to put fewer dollars of capital into a business that turns out many more dollars of revenues and return on capital than anyone else. It doesn't make its money by providing a physical product that you can't get anywhere else -- it makes money because it provides service that no one else can touch.
What's the grand conclusion on all of this? I dunno. I guess I just had to gripe about this. Being a curmudgeon can be fun -- you might want to try it sometime. I think the lesson that can be taken away is that one should at least examine the premises of how a company makes money before putting it into a box that identifies it as "high-tech," "pharmaceuticals," or "aerospace." How anyone can think of something like Amazon.com as a tech company is really weird. What does that tell you? The usefulness of that characterization is negative because you might start comparing Amazon.com to Intel or Pfizer before you compare it to its real competition, which is other retailers. When you hear "tech stock," it's almost always useful to tune that out. If there is a tech sector, it's not the monolith that it's always identified to be. And if there is a tech sector, it should rightfully include a heck of a lot of companies that normally aren't thought of as being technology companies.<% ' AvantGo:End %>
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