"Banken müssen noch vorsichtiger sein als Facebook"
Fundresearch: In a current statement you’re saying that stock market valuations of technology companies are still at a high level, therefore further declining share prices cannot be ruled out. Which share price level would be appropriate for technology stocks, more specifically the GAFA or FAANG titles, from your point of view?
Jacques-Aurélien Marcireau: We are not allowed to give price recommendation. We can however say that we are invested in Google with a significant position and Facebook as a minor position. Other FAANG names are not part of the portfolio. In itself this would be indicative of our view on these names.
Fundresearch: Technology companies, which make their money with big data, are currently in the focus of public attention, not least because of data leakage at Facebook and recurring glitches and hacks at which large amounts of user data fell into the wrong hands. How do you rate the risk which is included in the shares of data companies?
Jacques-Aurélien Marcireau: Cybersecurity & data (trade secret, know how, IP) theft is a critical issue for every company in every sector. I would be particularly mindful of companies where data privacy is at the heart of their business model. Banks have to be even more careful than Facebook at the end of the day.
Fundresearch: Which trends will influence the technology sector most in 2019?
Jacques-Aurélien Marcireau: We expect the strategic imperative of leveraging big data potential to prevail once again in 2019 with companies spending on IT modernization / transformation. We also expect that some high growth / high valuation name would continue to suffer as people get more realistic about what can be done and what cannot be done YET with data and AI. Several factors will continue to weigh heavily on tech stocks: the US-China trade war, the turmoil in cryptocurrencies, the slowdown in the smartphone market, the risk of regulation and a slower-than-expected cycle of technological innovation.
Fundresearch: Which trends do you see in medium-term and at which stocks do you especially have an eye on?
Jacques-Aurélien Marcireau: The theme seems to us to be well positioned in the short, medium and long term and as such we are tackling the renewed volatility with serenity, given the fundamentals and attractive valuations of some companies. This is the case, for example, of Google, whose valuation of 18.5 times the expected results is reasonable and the potential for innovation remains intact. Investors have a better grasp of tech stocks, and particularly GAFA companies and so naturally they have invested massively in them. But we think it is easier to find investment opportunities in other segments like infrastructure providers, who enable access to these data, and data users, non-tech companies which exploit data to achieve a strategic advantage. Their average valuations are still more reasonable. Over and above the tech sector, data processing has also had an impact on more traditional sectors like banking and insurance, industrial maintenance, energy efficiency, autos and healthcare. An auto industry forerunner like Munich-based BMW Group is looking to get the most out of the data revolution by building a digital ecosystem to improve the customer experience.
Fundresearch: There are companies which experiment with a (monetary) valuation of user data – a stock market for user profiles for example. Do you think it's possible that users will soon be letting their data to companies and receive compensation for it? What impact would this have on the data processing industry?
Jacques-Aurélien Marcireau: We do not think this will get a meaningful traction, as data is a non-rival, non-exclusive asset whose value can erode quickly as soon as it is shared too widely. Besides, people willing to sell their data are most of the time people with the less valuable data.
powered by €uro FundResearch