Small-Cap Tech Companies May Gain as U.S. Growth Seen Into 2013

The investment outlook for small-cap technology companies is improving as cheap valuations and conservative earnings estimates make them more attractive, after being weighed down by concerns about the economy.

Small-cap businesses are expanding to provide additional products and services -- including the delivery of storage, software and other computing tasks over the Internet “cloud.” This is boosting sales, as valuations and estimates for 2012 earnings remain moderate, said Steven DeSanctis, head of U.S. small-cap strategy at Bank of America Merrill Lynch Global Research in New York.