Making Money in Technology
After the Bubble, page 31
Picking up “Goodies”
Long-term, great technology always wins. In the worst case, a company that has great technology but lousy
management will get purchased, usually at a premium.
This means that in the current climate it makes sense to buy stock in companies that have truly great
technology but have been beaten down. You should plan on holding these shares longterm.
For example, Autonomy (NASDAQ: AUTN) has been as high as $64 in the last year. It now sells for $5 a share.
Based on Cambridge University research, Autonomy sells the best tool for intelligent searching through
unstructured data such as Word documents, Web pages, e-mail, etc. There are many applications for this
software, and the amount of data out there is only growing. Autonomy would seem to be a long-term winner.
Corvis (NASDAQ: CORV) currently sells for around $10 a share. It has been as high as $110 in the last year.
Corvis is a leading all-optical networking company. As all-optical solutions win greater acceptance,
and as the telecommunications market comes back, Corvis is a winner.
Nuance (NASDAQ: NUAN) is the leading vendor of speech-to-text voice recognition software. Nuance sells
in the low teens; it has been as high as $180 in the past year. Nuance’s ambition is to supply the “dial-tone”
to a new generation of devices, and it stands a good crack at succeeding. The Nuance technology is hard to
duplicate, and essential for many interface tasks.
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