This recent wave of merger news provides some of the strongest evidence yet that companies are willing to do some long-term planning. The kind of deals getting announced not just bolt-on acquisitions but transformational deals.
You've had a narrow group of tech companies that have been delivering positive and accelerating growth characteristics and money tends to get concentrated in those few companies that are doing that.
At this point, boring makes for an interesting fourth quarter. I think this year's losers win. The stuff that people chucked from their portfolios is what they will want back.
Sun has not gotten its cost structure under control and is more of a strategic muddle.
Clearly there are a lot of industries in tech that are just begging to be consolidated. So the question is not whether the pace of M&A picks up in 2005 but whether it will represent a breaking of the dam.
The bond market is keenly aware that cash flows have improved and that the chances of investors getting back money they are owed is better. That's not at all irrelevant to stockholders.
There's no unilateral belief about tech stocks. People are confused and somewhat justifiably.
In the late '90s investors believed that tech was such a great secular growth story that cycles didn't matter. In this rebound, the only thing that matters is the economic context.
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