Dinosaurs are extinct. But dinosaur tech stocks? They're thriving lately.
Microsoft (MSFT) was up 2% Wednesday and shares passed $30 for the first time since October. That move comes after a nearly 4% rise on Tuesday. Intel (INTC), the chip yin to Microsoft's operating system yang in the Wintel PC market, rose 3% Wednesday. It was up 3% Tuesday too. And Cisco Systems (CSCO) followed up a 2% pop on Tuesday with a 2.5% pop on Wednesday.
What do these three techs have in common? They're all members of the Dow Jones industrial average. They are older and more established (a nice way of saying mature) companies. And they pay dividends. Big ones, in fact.
Microsoft and Cisco have payouts that yield more than 3%. Intel's yield is above 4%. By way of comparison, the supposedly safe 10-year U.S. Treasury note yields just 1.8 %.
Several traders on StockTwits suggested that the rally in Old Man Tech could continue, especially since investors are desperate for income in an environment of unusually low interest rates.
It is stunning to see. For a second there, I thought it was the mid-late 1990s. (Ahh ... to be in my 20s again. But I digress.)
Not even an analyst downgrade of Microsoft was enough to deter investors Wednesday. BGC Partners cut its rating on Mister Softee to hold. The reason? The fact that the PC industry is in "turmoil." That isn't exactly news though. So maybe that's why traders were willing to ignore it?
That may be true. But BGC does have a point. The PC market is in flux. There's a reason why Dell (DELL) is trying to go private. And I'm still perplexed as to why Hewlett-Packard (HPQ), another dinosaur tech that pays a decent dividend, is up as much as it is this year.
Seems like some traders agree with me. A few think that like all good momentum plays, the recent spike in Microsoft (and perhaps other techs) could soon come to an end.
Ha! Odds are you may be viewing those commercials on YouTube while using the Chrome browser. Google (GOOG) really is the new Microsoft. It's the one with all the power and momentum.
Finally, one StockTwits user pointed out that Microsoft, Intel and Cisco aren't the only "old" techs rallying lately. Apple (AAPL) has finally shown some signs of life again. And even though you could argue that Apple has more growth potential than other big techs, many investors are still treating Apple as if its best days are behind it.
It's funny how Tim Cook has all of a sudden become a CEO that investors love to hate, much like Ballmer.
For what it's worth, Apple also pays a healthy dividend -- even though some want the company to use that $137 billion in cash to boost the payout. So forget about the old (literally) Four Horsemen of Tech. Maybe Apple, Microsoft, Intel and Cisco are the "new" Four Geezers of Tech?
As long as they keep paying dividends, investors might not care what silly nicknames people like me have for them.
Warren Buffett is getting back to basics. Berkshire Hathaway's three new third quarter investments are in companies that create the building blocks for manufacturing and agriculture.
Warren Buffett's Berkshire Hathaway (BRKA) (BRKB) purchased new stakes in Deere & Company (DE), Precision Castparts (PCP), and Wabco (WBC), according to SEC filings released Wednesday afternoon. Deere is the well-known maker of tractors and other farm equipment. Precision Castparts makes the nuts and MOREMaureen Farrell - Nov 14, 2012 5:46 PM ET
Amazon.com is in advanced negotiations to buy the mobile chip business of Texas Instruments, according to Israeli newspaper Calcalist, which would put the online retail giant on the path to becoming a manufacturer of smartphone and tablet processors.
Shares of Dallas-based TI (TXN) rose nearly 3% following the report, while shares of Amazon (AMZN) declined slightly.
Amazon's Kindle Fire tablet is currently powered by a TI processing chip, and the company has MOREHibah Yousuf - Oct 15, 2012 12:44 PM ET
In a world fraught with uncertainty and volatility, the executive team at Caterpillar (CAT) can evidently see the future -- three years into the future. The equipment maker slashed its revenue and profit forecasts for 2015. It cited the likelihood of "modest" economic growth at an industry conference this week.
Should growth fall farther than the company's modest predictions, Caterpillar's CEO Douglas Oberhelman promised that investors would still find reasons MOREMaureen Farrell - Sep 25, 2012 4:42 PM ET
The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, and Abbott Laboratories, La Monica does not own positions in any individual stocks.
Who needs to own a boring U.S. Treasury bond when you can buy an exciting tech stock and get a similar -- or in many cases, higher -- yield in the process?
Cisco Systems (CSCO) announced Wednesday MOREPaul R. La Monica - Aug 16, 2012 1:14 PM ET
Warren Buffett might not like technology that much after all.
The legendary investor exited his entire position in Intel (INTC) during the second quarter. His firm, Berkshire Hathaway (BRKA) (BRKB), bought into the computer chip making firm just three quarters ago. Such a rapid exit is rare for Buffett, who is known for his buy-and-hold value stocks ethos.
Berkshire Hathaway's only addition to his fund's portfolio in the second quarter was the MOREMaureen Farrell - Aug 14, 2012 4:58 PM ET
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