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Last February, "Smacs" (his Web handle) wrote that Canadian graphics technology firm

ATI Technologies


just might have the right stuff to become a gorilla stock. His reasons: The firm's components could well find a place in fast-growing markets for TV set-top boxes and e-appliances. Still, Smacs urged caution: "Throw ATYT on the watch list, but don't bet the farm yet. ... Regardless of whether they become a gorilla, I think they're moving up."

In fact, ATI Technologies did climb from around $12 to just over $20 during February. And it held fairly steady at that level until May before dropping sharply on the heels of several analyst downgrades. True to Smacs' cautious predictions, ATI Technologies was trading at around $8 earlier this week.

Read Smacs' thoughtful, detailed

analysis of ATI Technologies and you'll see he wasn't just shooting from the hip.

His due diligence, though not polished, compares favorably with that of many professionally prepared analyses. Indeed, Smacs, who is technical director for an Ontario high-tech firm, is one of perhaps hundreds of investors out hunting for next-generation blowout technology stocks -- also known as gorillas.

Smacs and other gorilla hunters prepare detailed reports on companies they believe will climb to the top of the vine. Those reports, along with numerous posts, can be found on two

Silicon Investor


Gorilla Game Investing in the eWorld and the

Gorilla and King Portfolio candidates. Both threads generally follow the investment strategies outlined in the book

The Gorilla Game: Picking Winners in High Technology

by Geoffrey Moore, Paul Johnson and Tom Kippola. The three authors, all of whom have ties to the venture capital industry, define a gorilla stock as a company that can rule a market with its proprietary technology. (Visit the book's

Web site for a more detailed explanation of the gorilla hunting strategy.)

TheStreet Recommends

The ultimate gorilla would likely be


(MSFT) - Get Microsoft Corporation Report

, of course. Not because of its beastly treatment of competitors. Rather, the King Kong of software neatly meets the key criteria the authors use to define gorilladom: Its Windows operating system has a lock on millions of PCs. Just as significantly, Windows changed how millions of us manage our work and play. And it has spawned an entire industry of its own -- namely the countless software firms that must make their applications work within the Windows environment. In the process, the company's stock over the years has gone bananas.

OK, Microsoft is old news. And the fact that its stock was trading near its 52-week low this week proves that even the greatest gorillas can find themselves shot down from lofty heights. But the laws of gorilla investing still rule the market jungle, the book's many followers say. Where might you find the gorilla stocks of tomorrow? By combing through the "Hunt Reports" prepared by Smacs and others. You can find the reports on the "Gorilla and King" thread.

Gorilla Could-Bes

However, as of last week, that thread had more than 38,000 posts. Fortunately, one of the thread's contributors, Erik Erickson, regularly collects the reports, as well as the more notable postings. And he has placed both on his own

Web site. Once you're at the site, just click on "Project Hunt reports" and a whole list of reports on gorilla could-bes comes up. Some, like




(RNWK) - Get RealNetworks, Inc. Report

, are household-name tech stocks. Others, like


(KOPN) - Get Kopin Corporation Report

, a manufacturer of tiny flat-panel displays, and the Internet billing firm

Interface Systems

, are less well-known outside tech investing circles.

Many of the Hunt Reports follow a standardized format. The companies are scrutinized via a checklist of questions that serve as a litmus test for gorilladom. One question reads: "Is there a proprietary open architecture?" In other words, can other companies adapt the gorilla's technology to create products of their own in the way software developers create programs to run on Microsoft's Windows? Another question: "Are there high barriers to entry and high switching costs?" Still another question asks: "Have value chains developed?" Meaning: Are there strong economic incentives for other companies to link with the gorilla to develop products based on the gorilla's technology?

Tornado Watch

Gorilla analysts pepper the reports with their own terminology: A company becomes a "tornado" when a key event, such as a large purchase order, propels it into a hypergrowth phase. Alternately, companies may fall short of gorilladom and find themselves stuck in the bowling alley. Or they may establish themselves as "strong kings" -- good companies, but not quite gorillas.

Here's what a poster, John Huber, a certified public accountant,

wrote last January about

Wind River Systems


, which develops small-scale operating systems used in portable computing devices: "I feel that, with the design wins they already have in future mass markets combined with their business model of charging a royalty for each copy of their software ... strong future growth is almost assured." Huber goes on to say that competition from two other operating systems, Microsoft CE or a scaled-down version of Linux, could stymie Wind River's growth. Nevertheless, true to Huber's predictions, the stock has held up well in comparison to other tech stocks. Earlier this week it was trading at around $40. Not too shabby considering Wind River's March high was $60 -- and in a week that saw many investors leaping and snorting in frustration as the market tumbled.

To gorilla hunters the clear lesson here is that these stocks -- by virtue of the lock the companies' technologies hold on the marketplace -- will eventually emerge victorious once the market quits going ape. Nevertheless, gorilla investors know they must be patient. In a market that now seems ruled more by angry bears, they've watched many of their favorites slide off the vine. As a poster named Morgan wrote on


last May: "What in the world happened to all the gorillas?" To which he answered: "They are in the mist for the time being. Soon it will clear, the sun will come out, and gorillas will start beatin' their chests."

Mark Ingebretsen is editor-at-large with

Online Investor magazine. He has written for a wide variety of business and financial publications. Currently he holds no positions in the stocks of companies mentioned in this column. While Ingebretsen cannot provide investment advice or recommendations, he welcomes your feedback at has a revenue-sharing relationship with under which it receives a portion of the revenue from Amazon purchases by customers directed there from