If you didn't know any better, we were back in 1999 when Intel (INTC) and Microsoft (MSFT) and Western Digital (WDC) and Seagate (STX) were hot as freshly shot cannonballs, because we figured out how to get some "high speed" lines to connect personal computers to the world wide web.
Of course, those companies are, with the exception of Intel, really very different beasts now. Yes, they all have exposure to the personal computer still. Microsoft dominates its end, as it always has. Seagate and Western Digital still rule in the disk drive world. And Intel dominates the microprocessor.
But Microsoft has pivoted, and truly has become an important player in the cloud with Azure. Seagate's biggest drives are now in shortage, the ones that handle all of that web data. Western Digital bought flash, which sits in the cellphone.
Intel? It actually had good personal computer numbers, better than it thought they would, better than it did for the data center business that's so strong for everyone else.
But it will work. It will do.
The explosion in data is so great that it's almost like, if you have storage space, we'll take it!
Now, of these stocks only Microsoft truly has a price-to-earnings multiple of any note: 21x. I would argue that because the shift to the cloud and the acquisition of LinkedIn (LNKD) is now embedded in the numbers, the multiple is warranted.
Intel at 13x? Probably too cheap, especially if the data storage "disappointment" -- quotes only because many wish they had that kind of growth -- is a hiccup.
Western Digital and Seagate? After listening to Microsoft and Intel last night? I think they are just plain old buys. Even up here.