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What's interesting about this stock market correction is that technology earnings have been rising while the stock prices of large technology companies have decreased. This is an opportunity.

Technology spending is starting to bounce back, and there is evidence that capital-spending budgets are loosening up a bit. Given that 2010 is off to a good earnings start for technology companies, I think there's a high probability that companies continue to increase tech spending.

I have been combing through the stock screens looking for “dream stocks” – large-cap tech with good track records, improving earnings and cheap valuations. I found lots of candidates. In fact, other than spring of 2009, it was hard to find a time when you could buy high-quality tech stocks at such cheap valuations. Many of them are at P/Es under 20, including Apple (AAPL), which has a 5-year growth rate of more than 40%! I cannot remember the last time a stock with this kind of growth was available at a forward P/E of 19.

These companies have rock-solid balance sheet (billions of dollars in cash), low or no debt, earnings power, and they are generating large amounts of cash flow.

Here are my Top Five:

Apple Computer Inc. (AAPL)

5-Year Sales Growth: 39%

Return on Equity: 32%

Forward P/E: 19

Dividend Yield: N/A

Microsoft (MSFT)

5-year Sales Growth: 10%

Return on Equity: 41%

Forward P/E: 12.7

Dividend yield: 1.86%

Cisco Systems Inc. (CSCO)

5-year Sales Growth: 10%

Return on Equity: 15.5%

Forward P/E: 15.5

Dividend yield: N/A

Hewlett-Packard Inc. (HPQ)

5-year sales growth: 7.5%

Return on Equity: 19%

Forward P/E: 10

Dividend yield: .68%

EMC (EMC)

5-year Sales Growth: 11%

Return on Equity: 8%

Forward P/E: 19

Dividend yield: N/A.

Disclosure: Long MSFT, thinking about buying CSCO and AAPL.

Source: Top 5 Blue-Chip Tech Companies for Investors