A lot of what we used to call ink has been spilled in the 10 long days since Donald Trump was elected president regarding what impact his administration will have on Silicon Valley. Indeed, shares in some of the best companies in tech have declined, pegged to a variety of conflicting fears. Skilled workers will be scarcer, given Trump’s anti-immigration stance. A trade war would sink export-heavy, highly outsourced device makers. Trump and Amazon’s Jeff Bezos don’t like each other, and the former has a penchant for litigating against his enemies. The list goes on.
Discerning specifically how a Trump administration will affect tech companies is harder than it looks. This delectable article from The Wall Street Journal illustrates how unclear Trump’s position has been on H-1B visas for high-skilled workers, for instance. Sometimes his campaign vowed to eliminate them; sometimes it ignored the issue altogether. (A nugget: fashion models can qualify for H-1Bs: Melania Trump once did.)
Gene Munster, a level-headed analyst with Piper Jaffray, surveyed the landscape and concluded optimistically that “best-in-class” technology stocks are attractive as a result of their post-election sell off. Munster’s felicitous five are Alphabet, Apple, Amazon, Facebook, and Netflix. Before markets opened Thursday, each had lost between 3% and 7% of their values. (All five were up or down a bit more or less than 1% Thursday.) Except for Amazon, each is priced at a reasonable valuation, relative to their earnings. Apple, as has been the case for years, is downright cheap.
Munster believes investors are reacting to “snippets” in the news rather than actual policy. He notes that Trump’s plan for his first 100 days omits any mention of technology. “We believe the tech industry is in more control of its own destiny than Donald Trump,” Munster writes. That feels like a hopeful way to end the week.
I’ll take a short break next week. Mathew Ingram will weigh in with his meaty thoughts, and Heather Clancy, as always, will keep you in the know on what’s what in tech.
Mindful of just how much we have to be thankful for, Happy Thanksgiving.