Back to technology: Patrick Lyons of NCM Capital Management says a tech binge is likely.

Patrick Lyons, ah associate portfolio manager at Durham, North Carolina-based NCM Capital Management Group, s the battered and bruised technology sector, once the darling of Wall Street investors, is primed for a comeback. Lyons is charged with overseeing three sectors for NCM Capital: technology, telecommunications, and utilities. He also co-manages a large-cap growth fund that holds $460 million of public and private pension funds, as well as Taft-Hartley plans and endowments.

Lyons chooses stocks that have a market capitalization Of at least $2 billion. He also looks for companies that are dominant producers of a particular product, have a management team that has experienced tough market cycles, and have healthy earnings growth. "We typically like to see companies growing at least 10% over a 12-month period," he says.

Lyons believes the economy will grow by 4% or 5% over the next four quarters. "We are starting to see a pick-up in business orders from a lot of technology and industrial companies," he observes, mostly due to "the three year cycle" that normally passes before public and private sector customers upgrade their technological infrastructure.

That's why Lyons likes Intel Corporation (Nasdaq: INTC), a manufacturer of computer, network, and communications products: "Intel has 80% of the microprocessor market and will get the lion's share of business flora new PC sales." He also notes that the popularity of Centrino notebooks, which contain mobile technology and have extended battery life and integrated wireless LAN capability, is on the rise.

Dell Inc. (Nasdaq: Dell), a company that designs, develops, manufactures, services, and supports a wide range of computer systems, is also on Lyons' list, Formerly known as Dell Computer Corporation, the No. 1 PC maker also markets storage equipment, workstations, and has recently begun pashing into the consumer electronics business.

"The company's growth engine, going forward, will be their consumer electronics products, like the 17 inch, LCD TV. They are also coming out with a digital music player and an online music service where you can download music for a fee," Lyons says.

Lyons also selected Nextel Communications Inc. (Nasdaq: NXTI,), a provider of digital wireless communications services primarily for business users. He says Nextel has strong subscriber growth and has made itself more attractive by refinancing and retiring about $4 billion in debt.

Lyons picked Staples Inc. (Nasdaq: SPLS), which sells office products, supplies, and services, including business machines, computers, and related products. He says there is a strong correlation between small business confidence and Staples' sales momentum, therefore the company should benefit from rising sales in the tech industry.

And lastly, Lyons picked Cendant Corporation (NYSE: CD), which has five business segments: real estate services, hospitality, travel, vehicle services, and financial services. Its businesses include CENTURY 21 and Avis Group Holdings. "We like this company because their real estate division will continue to take advantage of a strong housing market that has been fueled by low interest rates:' says Lyons. "We also believe that as the economy continues to improve, business travel will pick up and business travelers will want, to rent a car."

Patrick Lyons

Private Screening Picks

Company                                      12-to 10-Month
Exchange: Symbol              Price *         Price Target

Intel Corp                   $30.43              $40.00
Nasdaq:INTC

Dell Inc                      35.41               45.00
Nasdaq: Dell

Nextel Communications Inc     21.40               30.00
Nasdaq: NXTL

Staples Inc                   25.46              $35.00
Nasdaq: SPLS

Cendant Corp                  19.44              $25.00
NYSE: CD

                                              Est. 5-Yr.
Company                  P/E on Projected     Annual CPS
Exchange: Symbol           2004 Earnings      Growth Rate

Intel Corp                   39                  15%
Nasdaq:INTC

Dell Inc                     35                  15
Nasdaq: Dell

Nextel Communications Inc    19                  12
Nasdaq: NXTL

Staples Inc                  23                  16
Nasdaq: SPLS

Cendant Corp                 14                  14
NYSE: CD

Company
Exchange: Symbol             Why Stock Will Outperform

Intel Corp                   Increased computer technology sales
Nasdaq:INTC                  to public and private sector; attra-
                             ctive new and innovative products.

Dell Inc                     Increase in computer and consumer
Nasdaq: Dell                 products sales.

Nextel Communications Inc    Company has refinanced and has eli-
Nasdaq: NXTL                 minated debt; has strong subscriber
                             base.

Staples Inc                  An increase in small business spen-
Nasdaq: SPLS                 ding should increase sales.

Cendant Corp                 Real estate boom should continue;
NYSE: CD                     business travel should increase.

* AS OF OCT 10. 2003

SOURCE: PATRICK LYONS, NCM CAPITAL MANAGEMENT GROUP