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3 Tech Picks As Bearishness Rises

Stocks in this article: BBRY MU ORCL

CHRIS LAU, KAPITALL: An increase in short-selling volume for companies also indicates a rise in bearishness. Between March 28 2013 and April 15, short interest rose for a number of widely-followed companies listed in the table below. [Related:  5 Bullish Calls in Technology From Jim Cramer]

Screen shot 2013-05-08 at 12.02.05 PM  

Since the share prices of these companies are all up since mid-April, is the contrarian move to be bullish on them instead?

Bears continued to be relentless in short-selling Blackberry (BBRY)¸but the company is on track with its transition to Blackberry 10. The U.S. Department of Defense (“DOD”) approved the use of BB10 smartphones, as well as Blackberry’s Playbook. Bears pointed to the DoD also signing off in allowing for the use of Apple and Samsung devices. They failed to recognize that the DoD will likely use the Blackberry Mobile Device Management solution in managing these devices.

Blackberry also launched its flagship keyboard-based Q10 model, a device that will ensure upgrades from its core fans. Financial firm RBC thinks Blackberry will sell 2.75 million units in the May quarter. This is an upgrade from a previous forecast of 2 million.

Oracle (ORCL) bearishness rose by 33% as short interest increased to 42.37 million shares. Gartner estimated that corporate reliance for SAP implementation was just 41%. 59% of the software implementation for SAP was for Microsoft’s (MSFT) SQL Server and other database solutions. Oracle showered investors with earnings growth quarter after quarter, but risks will always remain. Sybase, DB2, and MySQL are compelling alternatives to the expensive Oracle backend solution.

Fast-growing company ( CRM) released to help companies manage ad campaigns in the social media space. This could increase the competitive pressure for Oracle.

In the chip space, Micron Technology (MU) is close to yearly highs, up 87% from its yearly low. Helped by rising chip prices, Micron reported strong quarterly results, but is attracting bearish investors. The company announced a PCI-Express flash module that would help the company expand sales in the enterprise.

Negativity for chip companies may continue to rise. In the last month, SanDisk (SNDK), Qualcomm (QCOM) and OCZ (OCZ) traded lower, as Micron tested new highs. By April 15, 2013, short interest for SanDisk rose 16% to 9.36 million shares.

Written by  Chris Lau


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