The tech bulls took a bit of a breather this week, leaving the major indices flat or down just a bit. But as the closing bell rang on the last trading day of July, there was talk on Wall Street of further gains.

"I think technology stocks are still undervalued by 20% to 25%," says Dan Niles, CEO of Neuberger Berman Technology Management.

Seem too aggressive?

Since the bull rush began in mid-April, the

Nasdaq Composite

has gained 15%, while the Philadelphia Stock Exchange Semiconductor index has gained 24%, the Goldman Sachs Software Index is up 12%, and the TheStreet.com's index of 24 Internet-related stocks has increased 19%.

Niles' estimates probably tend toward the high side, but he's hardly alone in his optimism.

Richard Suttmeier, chief market strategist for Joseph Stevens & Co. and a contributor to

TheStreet.com

, figures technology issues are about 14% shy of fair value, making them the most undervalued major segment in the market. Robust demand for chips -- exemplified by this week's

strong earnings report from

Texas Instruments

(TXN) - Get Report

-- and broadband services are the drivers, says Suttmeier.

Niles, a former semiconductor analyst turned buy-side executive, says that capital expenditures as a percentage of revenue are still relatively low. What's more, now that at least some of the uncertainty that plagued the market last year (the national election and interest rates, among others) is gone, investors are placing a higher value on good earnings.

Last year, although corporate profits were up as much as 20%, the

S&P 500

gained only about 9%. This year, the ratio is roughly the opposite, Niles says.

Although there was plenty of earnings news to keep them happy, tech investors were quick to turn against companies whose guidance for the September quarter failed to meet Wall Street's expectations. Two notable examples:

Symantec

(SYMC) - Get Report

and

to a lesser extent

LSI Logic

(LSI) - Get Report

.

Investors were confident that Symantec, which now has a market cap of $15.6 billion, would post decent first-quarter numbers --

and it did, despite some softness in consumer sales. But the real game was betting on guidance for the second quarter, the first period in which the antivirus maker will report financial results that include recently acquired Veritas.

Management set a lower-than-expected bar for the quarter and for the rest of the year, saying it will be moving consumer sales to a new model that will result in lower license revenue but lead to higher and more predictable deferred revenue.

Also slowing guidance: a likely hit caused by the strengthening dollar, which weakens overseas sales. Valid as those reasons may be, Merrill Lynch analyst Edward Maguire called the results "wobbly," and investors knocked more than 7% off the stock in 24 hours.

Isn't it interesting how quickly managers blames problems on currency fluctuations, and how slow managers, and some analysts, were to credit the weak dollar for more than a year of upside? (We're talking in general here, not singling out Symantec.)

Meanwhile, my colleague Kevin Kelleher points out that the nearly completed earnings season has changed some minds about how to make money on Internet stocks. After six months of a growing consensus that e-commerce was wilting while Internet search was unstoppable, the June quarter saw an abrupt reversal in those trends.

Amazon

(AMZN) - Get Report

managed to keep marketing and fulfilling costs under control while pushing operating margins up to 6%, while most analysts figured the company would do well to reach 5%.

A week earlier,

eBay

(EBAY) - Get Report

surprised investors with a strong earnings report, while

Yahoo!

(YHOO)

and

Google

(NYSE)

had reports that, while showing healthy financials, failed to sate investor appetites for growth.

Also notable this week:

The corporate information-technology spending outlook is still sluggish, but at least it's off the bottom and slowly heading north. That's the conclusion of the latest Goldman Sachs spending survey, which also found that

Cisco

(CSCO) - Get Report

,

IBM

(IBM) - Get Report

and

EMC

(EMC)

are gaining an increasing share of executive mind share -- and wallet share.

Goldman's panel of 100

Fortune

1000 IT honchos indicated that IBM's share of the executives' spending dollars for enterprise services and systems is growing the fastest, the first time Big Blue has gained such honors in the four-year history of the survey.

Dell

(DELL) - Get Report

, a perennial leader, slipped to the No. 2 spot, while

Sun Microsystems

(SUNW) - Get Report

, despite a reasonably good quarter, got the hairy eyeball from the panel, which said the struggling system and software maker is losing the most share in the segment.

EMC, though, looked golden.

The Goldman analysts positively gushed about the company, saying "EMC's dominance becomes clear in our latest survey. Although it has been a consistent presence in the share-gainer category, this is the first time it has been the sole leader in storage," they wrote. The report notes that EMC is benefiting from its software acquisition "which, together with a broad lineup of hardware and services offerings, provide EMC with the most complete set of storage solutions in the industry."

It was a rough week for company/analyst relations. Chipmaker

Altera

(ALTR) - Get Report

froze out Wells Fargo Securities analyst Tad LaFountain, a veteran of 25 years on Wall Street, because the company was unhappy with his coverage. After a burst of embarrassing publicity, Altera apologized and promised to give LaFountain the access he needs to do his job.

Although Altera's intemperate actions were unusual, other companies also have moved to close some traditional means of access.

MicroStrategy

(MSTR) - Get Report

, which some time ago stopped giving quarterly guidance, reported earnings this week -- but refused to hold a call. And it won't do so in the future, the company said in a press release: "The company believes that it is in the best interests of its shareholders to focus on long-term financial performance, which allows the management team to more effectively run operations and build long-term shareholder value."

While you could argue with MicroStrategy's logic, this was the wrong week to argue with the software vendor's results. Shares rose 18% after the company posted second-quarter financials that were well above expectations, initiated a $300 million stock buyback, and beat a patent infringement suit filed by rival

Business Objects

(BOBJ)

.

Commenting on the various beefs between analysts and the companies they cover, First Albany software analyst and managing director Mark Murphy offered this: "In many cases, less may be more. By not providing guidance you probably make the Street be more diligent and do more homework. I actually think it has the effect of making sell-side research more valuable," he says. Murphy was quick to add, however, that he is not advocating an end to either guidance or quarterly calls.

Gary Lutin, an investment banker and corporate governance advocate, minced no words. "Looking at the quarterly fluctuations in guidance is logically and mathematically unjustifiable. The whole idea of everyone focusing on whether off a company is off by 1% on a quarterly projection is just perverse."