InvestorPlace Editor Reeves: Among Tech Stocks, Choose Intel, Google

Tuesday, 11 Dec 2012 08:43 AM

By Dan Weil

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Technology stocks have registered sharp gains over the past four weeks, but InvestorPlace Editor Jeff Reeves recommends two laggards — Intel and Google.

Shares of the world’s biggest chip maker have hit the skids lately, touching a 52-week low Nov. 21. The company has been hurt by its reliance on personal computers and laptops and its failure to penetrate the smartphone and tablet markets much.

But Intel benefits from its size, a 4.5 percent dividend yield and a puny forward price-earnings ratio of less than 10, Reeves writes on Marketwatch.com.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

In addition, he notes, the firm is reportedly in talks with Apple to supply it with iPad processors.

As for Google, its stock has gained only 6 percent so far this year, compared with a 15 percent total return for the Standard & Poor’s 500 Index, and a disappointing earnings report last quarter held shares back.

But even in that supposedly bad quarter, revenue soared 45 percent. And profits are expected to continue their five-year surge, Reeves says.

Google’s Android operating system dominates 75 percent of the mobile device market, and the company’s record of innovation is second to none, he says.

Some analysts are bullish on tech dividend stocks.

"There's a very high level of confidence you can take [in them], especially the large-cap companies," Laton Spahr, a manager of Columbia Dividend Opportunity fund, tells The Wall Street Journal. "Their ability to move more and more of their cash flow to dividends has been a stable story."

Editor's Note:
How You Lost $85,000 During the Last Decade. See the Numbers.

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