A couple of days after the devastating attack on the World Trade Center towers and the Pentagon, I had dinner with a half-dozen investing buddies. We get together irregularly, every quarter or so, to toss around investment ideas both obvious and outrageous.

The answers around the table were pretty predictable, with mumbling and nodding by most of us after several of the names. When it came to my turn, I first went through the obvious litany about any purchases now being risky and about the return on small-company stocks certainly likely to be much higher, when the market comes back, than that of big companies. Except, of course, that the odds were so long against you in small-caps that buying small companies now was incredibly risky.

"So?" an impatient friend finally said.

Just one stock, a big company," I said. "EMC (EMC:NYSE - news - commentary - research). But not yet."

There were a few snorts, and not a few chuckles. I was, ahem, vividly reminded in the ensuing discussion that EMC has been on a slide, with the stock price more oozing downward than sliding, since early summer. EMC had closed Monday night, the day before the attacks, at $13.95, a long and painful fall for its many true-believer holders from its 52-week high, more than $100.

How could I suggest such an obvious loser?

The Smell of a Winner

Five reasons: First and most importantly, as soon as Corporate America starts to sort out its problems, post-WTC, it's going to go crazy adding more storage capacity. On-site, off-site, multiple off-sites: the push toward much wider and much more frequent backups of company data, as close as possible to real time, in several places presumed secure by virtue of their geographical distribution, is going to be huge.

And EMC, as the gold-plated, trusted storage vendor to a very large slice of U.S. business, is going to be the biggest beneficiary of that push. EMC's sales are going to rocket.

Second, I said, it has a strong management team, from Chairman Mike Ruettgers and CEO Joe Tucci right on down through a highly motivated, immensely skilled and experienced sales force.

Third, the right products, at the right prices. EMC has always been at the high end of the storage market, where most of the money is made. Though it's made some stabs over the past couple of years at playing in the lower-margin NAS (network-attached storage) and SAN (storage-area networks) markets, its long suit remains big iron, at big prices. That's exactly what you want right now: large capacity, rock-solid reliability and the big margins that come from selling premium-priced products.

Fourth, EMC has been good, and would probably be getting better fast, about cuts on the expense side of the ledger.

And fifth, I said, its competitors are likely going to be squeezed by falling share prices and reduced ability to raise the capital needed to compete in this suddenly rich but demanding market. (And it doesn't hurt at all that Compaq (CPQ:NYSE - news - commentary - research), a hidden giant in enterprise storage systems, is going to be gnarled up in its wrong-headed Hewlett-Packard (HWP:NYSE - news - commentary - research) deal.)

Ergo, EMC smells like a big winner, mid-to-long-term, coming out of this mess.

Be Prepared, but One Caveat

I recalled those words vividly Thursday night, when after the market close EMC announced it would probably lose money this quarter (as opposed to the previous consensus 1-cent gain), and would cut its workforce further to 21,000 from 23,400.

I expected to see analysts chopping away Friday morning, and that has come to pass. Friedman Billings cut EMC from accumulate to market perform; and while it didn't downgrade EMC, Bear Stearns cut its price target in half, from $45 to the mid-$20s.

EMC's Tucci put it plainly Thursday night: "EMC's cost reduction efforts will be sweeping in scope, encompassing our workforce, real estate, certain inventories and other areas.'' Which is exactly what the company needs, with its revenue falling and a hard-to-fathom few quarters ahead.

EMC had closed at $12.61, up slightly, Thursday night, before the announcement; it closed Friday at $11.15, down almost 12%.

Recall my lone cavil when I tossed out EMC to my dinner buddies: Not yet.

Even with that drop Friday, I still say not yet. I think it's time to accumulate EMC on further erosion, but with the market uncertainties now and immediately ahead, it's not time for a big EMC buy. But pay attention, and be ready to move: When sales kick up for EMC in the wake of the bombings, this one's going to shoot up faster than any other traditional tech stock I know.

Keep your powder dry for now, but be ready to move.