Predictions 2014

This is our last HotViews before the Christmas break.

We’ve introduced our Theme for 2014 – Race for Change and everyone of our Research Directors have given their Predictions for their respective streams.

But, for this final post of 2013, maybe I can be allowed to make my own predictions for 2014.

The UK economy is really set on a growth trajectory and I fully expect current forecasts to be exceeded. That will put extreme pressure on the BoE to raise interest rates and I expect an unholy row to breakout about political pressure NOT to raise those rates this side of the May 2015 General Election. Although, as I keep warning everyone I am not a stock-picker, I expect the FTSE100 to end 2014 with a ‘double- digit’ gain and I expect tech stocks to outperform.

UKIP will make major gains in the European Elections in May 14 and Scotland will vote to remain part of the UK in Sept 14 even though a similar poll in England might vote for separation by a large margin! General Election fever will grip the UK. For my prediction on that, wait for Dec 2014!

Diversity of Performance will be extreme. I can think of several quoted UK SITS stocks that I expect to go the way of 2e2. Any regular HotViews reader should know the list of possible candidates by now. Conversely there will be some great performers – we suggest in particular amongst those with dedicated (ie ‘no baggage’) Enterprise Cloud offerings and in the quasi-consumer space (social media, games, e-commerce etc). BTW – ‘Great performance’ now seems to mean revenue growth NOT profits. We’ve warned you on this many times before.

Last year I was asked to vote for my ‘Stock for 2013’ and I answered Amazon. Good answer as they are up 60% YTD. Asked the same question, I would give the same answer for 2014…and beyond. Google (also up over 50% YTD) and FaceBook (doubled since its 2013 low) will clearly benefit from a rebound in the economy and the continued shift to advertising online.

I also expect a very buoyant UK IPO market with several whoppers. Hurrah! Our Little British Battlers will ‘punch above their weight’. Hurrah! Indeed we expect several of our LBBs to feature in our ‘corporate news’ stories in 2014. Although still unlikely, an LBB IPO would be real cause for celebration!

I think many of the ‘old guard’ global large tech players will continue to have a difficult time in terms of revenue growth. HP, Microsoft, Intel etc will struggle. I think we’ll finally see some real fireworks erupt re: HP/Autonomy with law suits flying in the opposite direction. Indeed, many of the lead players will ‘lose’ their CEOs in 2014. I’d like to see Mike Lawrie take on the Microsoft CEO role. Just sincerely hope it’s not Stephen Elop.

2014 will be the start of the Era of Wearable Computing and I fully expect (hope!) Apple will be in the vanguard. Everyone will get involved and the only issue will be whether you have enough body area to wear them all. Perhaps we’ll resort to implants! Of course, the winner will be the ‘one device that does it all’. A generation that has done without a watch will find the ‘wristband’ really trendy – again. But 2014 will also be the start of the Era of Driveables. I can really see the logic of self-driving cars now – certainly ones that stop you crashing into cyclists (or anything else come to that). Even the Era of Flyables. Drones for commercial use are not science fiction anymore.

All in all, I think we are set for an exciting and positive 2014. And that’s been a rare outlook since 1999.

Posted by Richard Holway at '10:13'