By Simon Avery
Investment firms, portfolio managers and analysts frequently publish stock picks for the New Year, but few tell investors what to avoid. So kudos to Canaccord Genuity’s team for putting out a selection of tech stocks not to buy next year. Here they are:
Intel (INTC). The world’s biggest chip maker recently lowered fourth-quarter guidance, citing supply disruption. Analyst Bobby Burleson thinks that disruption will get worse the next quarter, and he sees demand softening for motherboard makers and component inventories rising.
LM Ericsson (ERIC). The Swedish maker of communications equipment may be hitting its revenue growth targets, but gross margin pressure will likely increase over the next several quarters, according to T. Michael Walkley.
Research In Motion Ltd. (RIMM) Slowing sales and weak guidance plague the BlackBerry maker, Mr. Walkley notes.
Powerwave Technologies (PWAV). The California maker of gear for wireless carriers faces a significant slowdown in spending by North American network operators and weakness in Europe and the Middle East, he writes.
Netflix (NFLX). The online content provider faces numerous challenges that include subscriber losses, rising content costs and an increased competitive landscape, says Jeff Rath.
Intuit (INTU). The financial software company is in good shape, but the stock looks expensive given the weak state of the small and medium business market place, says, Richard Davis.