Plenty of growth and tech funds out there are getting smacked by their bets on PC maker
, but it looks like many tech specialists have sidestepped some of
The Dell File
Business: Direct seller of computer systems
Fiscal Year 2000 Revenue: $25.27 billion
FY 2000 Earnings Per Share: 68 cents
2001 Estimated Earnings Growth: 33% (to 92 cents)
52-Week Range: $22.06 - $59.69
Percentage Change from Jan. 1: -44.2%
Market Cap: $73.4 billion
P/E Multiple: 34.6
Last night, PC giant Dell
reported fiscal third-quarter earnings that met Wall Street analysts' expectations, but said that future revenue growth would be lower than expected. Dell's shares started falling
last night and this morning
Morgan Stanley Dean Witter
downgraded the stock.
Since a cold for PC makers can lead to pneumonia for shops that make computer chips, Morgan Stanley Dean Witter also
cut its ratings and earnings expectations for chip titan Intel. Both stocks were in a Friday morning skid. In midmorning trading, Dell was off fallen 17.8% and Intel's losses totaled 8.8%.
About 40% of big-cap growth funds and tech funds own Dell shares -- 663 funds in all own shares, according to
. The stock started the day already off more than 44% for the year before Friday's bloodbath. (Dell was
Stock in the Spotlight earlier this week.)
many tech-fund managers are selling more PC-related companies in favor of more Net-centric networkers like
, which didn't take as bad a beating during Friday morning's selloff. That transition probably kept Intel out of many tech funds' portfolios.
The Intel File
Business: Makes computer chips
1999 Revenue: $29.4 billion
1999 Earnings Per Share: 1.16
2000 Estimated Earnings Growth: 45%
52-Week Range: $35 - $75.81
Percentage Change from Jan. 1: -4.9%
Market Cap: $277.8 billion
P/E Multiple: 25.7
Intel's shares, about flat for the year before today, are a must-own for many fund managers since it's a big part of the
and other benchmarks. More than 1,100 funds own shares, including nearly 80% of big-cap growth funds.
Given the fact that so many diversified funds own Intel, you might figure it's a core holding in just about every tech fund. But as part of the push away from PC-based tech stocks among sector-fund managers, only about half of the tech funds out there own shares.
Of course, while tech funds might be less bloodied today by the PC-oriented stock swoon, their 14.6% loss so far this year is a lot worse than big-cap growth funds' 5.3% slip.