Technology stocks rallied today, along with the broader marker. Chinese stocks rebounded and comments by FED vice-chair Fisher suggest that the rate hike could be postponed past the September date that many analysts are expecting. This led to dollar weakness and a broad-based rally in equities.
The internet-of-Things (IoT) will become increasingly important as the world becomes ever more connected. While most people think of phones and computers, the future of wifi connected devices will include washers, dryers, refrigerators, thermostats, meters, etc. It is estimated that 26 billion devices will be on the Internet of Things by 2020. Many believe it will be a transformational shift in the way we live our everyday lives, ideally increasing efficiencies and saving time, money and energy.
Our family recently took a road trip in a motorhome and stopped at a laundromat in Portland, Oregon. But it was not typical laundromat, as it had a bar, cafe, game room, couches and high-speed wifi. It was the owner's MBA project that became a reality. In addition to the amenities mentioned above, the washers and dryers also ask if you would like to receive a text when they are done. Sure enough, I received a text when the laundry was almost ready (5 minutes left) and another when it was done. This is an example of how the Internet of Things can make life just a bit more convenient.
The IoT sector has received plenty of hype over the past few years, so a correction in the sector that got ahead of itself was warranted. My favorite company in this space is Sierra Wireless (SWIR). They offer the industry's most comprehensive portfolio of 2G, 3G and 4G embedded modules and gateways, seamlessly integrated with their secure cloud and connectivity services. Sierra Wireless has more than 950 employees globally and operates R&D centers in North America, Europe and Asia.
The share price for SWIR had gone up more than 500% in just two years from 2013 to 2015. It has since corrected from $48 to $22, a retracement of more than 50% of the prior gain. I believe this offers investors an excellent opportunity to buy the dip on a company that is positioned to be a long-term winner in this space.
