Has everyone in techland forgotten that Februarys are almost always forgettable?

After rising 87% since early October, the

Nasdaq Composite Index

has dropped almost 10% from its high of 2533 on Feb. 1, leaving investors questioning whether the decline marks a bad case of seasonal PC jitters or the beginning of a cyclical downturn.

While nattering nabobs scream about how the PC revolution is over, more seasoned analysts look at February as the time when the techs take a deep breath after the Christmas season, preparing themselves for the year to come. During this seven-year tech rally, the tech-heavy Nasdaq index has fallen an average of 2% per year in February. In 1999, the drop was 10%, according to data-tracker

Baseline

.

"Everyone gets the blahs in February," says Joel Gechter, a hardware analyst with money management firm

Northern Trust

. "Too many conferences and the cold weather knock all us Wall Street types out."

Now it's March, and, unfortunately, the bad news keeps coming, though a 28-point rally in the Nasdaq makes everything look rosier this afternoon.

3Com's

(COMS)

warning Tuesday that it would not meet earnings expectations for its quarter ended Feb. 26 comes on the heels of

Dell's

(DELL) - Get Report

disappointing earnings report last month. Combine this with

Microsoft's

(MSFT) - Get Report

recent selloff -- because of the coming invasion of alternative operating system

Linux

and its own mishaps in the

Department of Justice

trial -- and there is a possibility that what happened to tech companies in mid-1998 may happen again.

Last year the culprit was an inventory glut in the PC industry.

Compaq

(CPQ)

was the worst offender, building up a 10-week supply of products in its channel and forcing the PC maker to unload inventory at a loss. Compaq is also involved in 1999's recent selloff, saying late last month that it had weak sales in the first part of this year's quarter.

What worries tech investors most is that revenue growth rates may be slipping because of price competition across the board. "I'm seeing a large topping formation in this market," says Morton Cohen, president of the money management firm

Clarion Partners

. "But I see nothing really wrong with the business cycles -- it's more of a global and seasonal nature."

This current paranoia was brought about after Dell -- the best-performing stock of the decade -- reported a 38% year-over-year revenue increase. While that's terrific for almost any other company, the fact that the direct PC seller may not be able to maintain its 50%-plus revenue growth is making analysts take a closer look at inferior companies' growth rates.

After all, if future revenue expectations come down throughout the sector, that could lead to a more substantial downturn. That's why PC and PC-centric semiconductor stocks such as

Intel

(INTC) - Get Report

and

Applied Materials

(AMAT) - Get Report

also are getting hit.

Of course, Dell is not exactly finished as a blue-chipper, says Philip Treick, manager of the

(TPAGX)

Transamerica Aggressive Growth fund. "What are people so worried about?" asks Treick, who has 6% of his $200 million portfolio in Dell and hasn't changed his position recently. "I don't think Dell is worried. They are still growing 3.5 times faster than the rest of their industry." In other words, if Dell can maintain a consistent growth rate, even if it's only around 40%, Wall Street will be satisfied.

BancBoston Robertson Stephens

PC and chip analyst Dan Niles, who saw last year's PC inventory problem coming months

in advance, says it's just a matter of adjusting expectations. "Expectations have gone from unduly pessimistic

in June 1998 to unduly positive

in January 1999 and are now headed back to the overly negative camp," he said in a recent report. Niles said Monday that his firm is becoming more positive on tech stocks now that Wall Street has reset its expectations to more realistic levels.

The tech sector would be free-falling if it weren't for those

Rocky Balboa

-like Internet stocks, which get battered time and time again but keep getting up. After faltering in the first half of February,

TheStreet.com Internet Index

has mostly bounced back to where it started, and is up 26% year to date.

While the PC sector, the driver of much of this 15-year-old tech boom, has been dealt a few bad hands lately, it still has a card up its sleeve: broadband communications, which would give individual PC users the same speedy Internet access corporations currently enjoy. That's why forward-thinking PC executives such as Dell CEO Michael Dell are already guiding analysts toward this

emerging trend.

While PC growth is stagnating, the top four PC companies still have opportunities for near-term earnings growth thanks to the rollout of the fledgling Internet generation. "Industry pundits have been saying the desktop market is saturated since 1994, when

International Data

said we would see only 9% year-over-year growth from here on," says fund manager Treick. "They have just been so far off for so long." In 1995, the worldwide PC market expanded 25.5% from 1994 levels, according to International Data.