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Technology Sector Analysis

The Information Technology Sector covers the following general areas: firstly, Technology Software & Services, including companies that primarily develop software in various fields such as the Internet, applications, systems, databases management and/or home entertainment, and companies that provide information technology consulting and services, as well as data processing and outsourced services; secondly Technology Hardware & Equipment, including manufacturers and distributors of communications equipment, computers & peripherals, electronic equipment and related instruments; and thirdly, Semiconductors & Semiconductor Equipment Manufacturers.

Key Statistics

Sector Fundamentals AS OF 09/08/2015 | | P/E (Last Year GAAP Actual) | 20.78 | P/E (This Year's Estimate) | 24.28 | Enterprise Value | $154.11B | EPS (TTM) | $3.75 | EPS Growth (TTM vs. Prior TTM) | 9.99% | Revenue Growth (TTM vs. Prior TTM) | 17.12% | Return on Equity (TTM) | 43.85% | Return on Investment (TTM) | 17.28% | Total Debt/Equity (TTM) | 127.81 | Dividend Yield | 2.23% |

The technology sector put in strong performance through most of 2014 and held up relatively well in the market selling in past months, but has shown signs of tiring as of late. We aren’t surprised some profit taking is occurring after the sector's good run, but we don’t think the overall story has changed and believe the positive trend will reassert itself. The innovation and entrepreneurial spirit that seem to pervade the technology sector make us excited about its future and support our outperform rating.
Balance sheets in the information technology sector appear solid, with large cash balances and relatively low debt. In our opinion, this enables the group to pursue mergers and acquisitions that might help performance by removing competition and…...

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