TCS Daily

George Gilder, King of the Net Stock Gurus

By James K. Glassman - March 13, 2000 12:00 AM

George Gilder, Editor of the Gilder Technology Report and columnist for Forbes ASAP, has become the ultimate guru for technology investors. The mere mention of a company in Gilder's newsletter sends share prices soaring. And with good reason, as the scoreboard on the back of a recent issue makes clear.

It's a list of the "Telecosm Technologies" that Gilder loves and the companies that supply them. Gilder is careful to note that he highlights "ascendant technologies," not recommendations to buy specific stocks at specific prices. But you get the point when his scoreboard shows the price of each company's stock on the date he first mentioned them, and then compares it to the recent price.

His track record is phenomenal. Gilder started talking up Qualcomm (QCOM) in July of 1996, because he believed in their CDMA technology for cell phones. CDMA has since become a standard, and Qualcomm shares have increased more than 2700% since then. Same story with JDS Uniphase (JDSU), the new leader in equipment to speed the flow of data across fiber-optic networks. Gilder bought into their vision of "Wave Division Multiplexing" and first mentioned the company in his June 1997 issue. Since then, investors in JDSU have enjoyed a return of more than 3800%. And the hits have kept coming - Broadcom (BRCM), Applied Micro Circuits (AMCC), Level 3 (LVLT), Terayon (TERN), etc.

We're thrilled to see George become the king of tech visionaries, because it couldn't have happened to a nicer guy or one who more perfectly captures the spirit of Tech Central. George is optimistic, intellectually courageous, and a forceful advocate for free markets. Having said that, we have to warn you. It's usually just about the time when everyone agrees on the brilliance of a guru that the guru starts disappointing people.

Here's what George is saying now: While many of us are focused on the bottleneck at the "last mile" - the old, slow telephone line into your house - George is concerned with the speed of data moving around the global Internet and even into space. So he likes Xcelera (XLA), whose Mirror Image subsidiary has a caching network around the world to allow content from popular websites to load faster on your screen. George also likes Low Earth Orbit, or LEO, satellite networks, because the data doesn't have to make the long journey between the earth and a geosynchronous satellite 23,000 miles up. Closer satellites mean faster data speeds, so George is optimistic about Globalstar (GSTRF), with its network of LEOs, and Loral Space & Communications (LOR), which owns a large stake in Globalstar. And he's still enthusiastic about the technological progress of Terayon.

Is George right about the ascendant technologies and the companies behind them? We have no idea. We just know that George has been right many times in the last five years.

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