Q&A: Michael Moe

As an analyst and investment banker, Michael T. Moe has lived through booms and busts in technology. He's the CEO of San Francisco-based ThinkEquity Partners, which hopes to be the next big tech investment bank. E-business Editor Timothy J. Mullaney spoke with Moe about the tech rebound.

What's the outlook for 2004?

It's positive. Business is accelerating for the first time in three years. Corporations are playing offense, not defense. And the weapon they're using is tech.

Who gets opportunity from that?

Enterprise software took us down [into the tech recession] and will take us out. Its applications to [help] businesses compete and manage are critical.

Any kind of software in particular?

Security software. As corporations increasingly become Web-centric, cyber- terror is a major issue. A couple of companies we think are poised to do very well are Secure Computing (SCUR ) -- we like a couple of things about them, including their valuation -- and Micromuse (MUSE ).

You've argued that small-cap tech will outperform the big names. Why?

What most people don't know is that small caps have been in a bear market since 1996. Clearly, small-cap and tech stocks have outperformed since Mar. 11, when the new bull market started. Why? First, they were due. But fundamentals drive the recovery and the market. When the wind blows out, it doesn't move big ships as fast. With small companies, the leverage is enormous.

Are there any big caps you do like?

We think Qualcomm (QCOM ), which is near its 52-week high, has great potential. It's the center of the wireless world.

Do you agree that the tech market will peter out once tax incentives for investment expire next September?

Pent-up demand is there. It's not just tax cuts -- globalization and innovation are creating secular growth well into 2005.

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