The Citi Global Technology Conference this Wednesday and Thursday is timely. We’re two months into the third quarter. Third quarters are important in tech because you have the build for the holiday season.
Investors will be looking for any hints from management how trends are progressing. Here’s some of the things we’re looking for.
General Body Language
Frankly, we want to make sure companies are still pumped about business. They should be. Tech’s been strong and demand has been strong. We want strong language that tech and demand have not slowed. That’s what the stocks need to move up. If we don’t hear that there could be risk.
DRAM Price Weakness Not Because Of Demand
We’ve heard some analysts and companies concerned that DRAM prices peaking and coming down in the spot market could be an early sign of weak demand. We don’t think so. We think supply has caught up with demand to some degree but, we’d guess demand has not slowed.
Capex Strong
Datacenter demand has been very strong at most semi players. Capex spending has been accelerating at the hyperscalers. We think that should obviously translate to continued strong trends at the datacenter. As long as capex remains very strong we have medium term visibility that this tech boom is very much in place.
Capex moving up also allays concerns of weaker DRAM pricing.
Trade Tensions
Any disruptions thanks to trade tensions?
Apple Food Chain
Apple’s launching new products September 12. Some Apple suppliers appear to have bottomed and we want to hear that Apple is bullish about the Fall launch and that inventory is lean enough for suppliers to benefit.
Stock Action
You’ll have the biggest funds meeting with the largest tech companies. Stock action matters on Wednesday and Thursday. What those huge funds hear can quickly get reflected in the stocks moving up or down. Ear to the train tracks.
Here’s the list of companies we’re watching more carefully:
