Portfolio manager Hyun Sohn discusses the current dynamics of growing tech industries and information technology trends that may carry through to 2021. HyunHo gives his outlook on major industries in the sector, while also looking at the current valuations of some of these major companies. HyunHo tries to find companies with good long-term fundamentals and continued earnings growth that may nevertheless be undervalued in the market. He still likes large-cap Internet companies, such as Amazon and Google, because they have unique business models and their revenues continue to grow. While their price is high, he doesn’t consider their valuations unreasonable. Sometimes companies in this sector can trade at 30 times earnings: HyunHo considers that too high, and that is something he tries to avoid. HyunHo feels positive on tech in the long term because of its fundamentals. Technology is being used increasingly every day by consumers, whether for shopping online, working from home or as a source of entertainment. He thinks the flexibility of working from home will continue post–COVID-19; for these reasons, both from a consumer and corporate perspective, he is bullish on tech.
Recorded on September 25, 2020.