We know the drill: U.S. retailers count on the holiday shopping season for as much as 20% to 40% of their total sales for the year.
And we know that this year won't be any different.
What we don't know is how much American consumers are going to spend: Will this season go like gangbusters, or will it just be a bust?
The National Retail Federation (NRF) is expecting a gangbusters holiday season, having just forecasted a record $602 billion in sales, a healthy 3.9% jump from 2012.
But the respected Gallup polling group is expecting a bust, saying that U.S. consumers expect to spend an average $704 each, or about 10% less than during the Christmas season a year ago.
Investors often handicap the major retailers, trying to guess which one will get the biggest share of the holiday shopping bucks.
We're not going to waste our time with that futile exercise.
You see, we know that the holiday season is also a big time of the year for gadget sales: American consumers are only too happy to drop small fortunes on computers, smartphones, and the other consumer-electronic gadgets that are the tangible results of this country's dominant high-tech sector.
We can predict who those winners will be, and can identify the stocks we believe will zoom as a result.
Today, I'm going out on a limb once again to predict that the tech sector will have a great Christmas overall. And I've identified four tech stocks to buy that should do well for investors this holiday season.
Packing a Punch
Back in June, I made what I called a "bold prediction" - and said we would see a surge in tech-sector stocks in the second half of the year. That wasn't the consensus view at the time: Most pundits were predicting a hefty sell-off.
Turns out investors who followed my advice June 28 and put their money in tech stocks as a group did well.
Since that time, the tech-oriented NASDAQ Composite Index has gained 16.73%, compared with a gain of only 11.5% for the "blue-chip" Standard & Poor's 500 Index.
That's a significant difference.
So, when I tell you today that I'm as optimistic as I was back then, you know I'm not just blowing smoke.
And here are the four tech stocks to buy that I'm handicapping as the big winners of this year's holiday splurge.
Christmas Tech Stocks to Buy - No. 1: Apple
Simply stated, Apple Inc. (Nasdaq: AAPL) just blew away the mobile market during 2012's holiday shopping season, which unfolded during that company's first fiscal quarter.
This year, Apple again has some hot new products that will make great gifts.
No doubt, the new iPhone 5S and iPhone 5C have gotten glowing press reviews from mainstream media like The Wall Street Journal and Time magazine. So, consumer and critical acceptance isn't an issue.
Meantime, the iDevice King also is getting high marks for the recent release of two new iPads.
The full-sized iPad Air version is not just lighter and alluringly shaped, the device also boasts improved battery life. Apple says the iPad Mini with the revered Retina display offers a resolution even better than what's offered via HDTV.
That gives shoppers four new mobile products to buy and give as holiday gifts.
During this same quarter a year ago, Apple reported a staggering 29% jump in iPhone sales. Now, I'll admit that such results will be tough to match - let alone beat.
But the good news is that Apple doesn't have to match those stellar results to have a fine quarter.
The Silicon Valley leader sold an astounding 3.7 million of the iconic smartphones a week for a total of 47.8 million units during that quarter. Apple also set a record for sales of iPads with 22.9 million, up 48% from 15.4 million the previous year.
To be conservative, I cut my projections for Apple in half compared with last year. And that still shows very respectable double-digit sales gains of handheld devices. And that makes Apple a "Buy."
Christmas Tech Stocks to Buy - No. 2: Best Buy
This could very well be the best holiday shopping season for Best Buy Co. Inc. (NYSE: BBY) in at least five years.
Last Christmas, new CEO Hubert Joly hadn't been at the firm long enough for analysts or investors to judge the effects of his plan to turn around the struggling electronics retailer.
Even the biggest critics are impressed with Joly's efforts. He has streamlined store layouts, retrained workers, and beefed up the firm's online presence.
And Joly is duking it out with his Web-based challengers - as a group - by having his stores offer such higher-margin tech products as smartphones, tablets, PCs, laptops, software, and digital cameras.
Now that the stock is up 272% this year, the pressure is on Joly to make this holiday season every bit as good. The reason: He needs to show that his plan will continue to work over the long haul.
The Big Box retailer already has one advantage: Because of the store's physical presence, it may have an advantage in grabbing sales of two new critical video-game releases. The reason: Consumers will actually be able to demo - play - the games in person, instead of watching a video clip on a website.
The games that I'm referring to are the Microsoft Corp. (Nasdaq: MSFT) Xbox One console and the PS4 PlayStation 4 console from Sony Corp. (NYSE: SNE). The Microsoft system is slated for release on Nov. 22 - following the Nov. 15 introduction of the Sony PS4.
A new report by brokerage Piper Jaffray forecasts total sales of consoles, games, and accessories will exceed $1.5 billion in the fourth quarter. Piper Jaffray says that Best Buy is well-suited to roll up a decent share of holiday gaming sales.
Given the company's long preparation and hard work, I expect Best Buy to post impressive sales gains this year. And that means that Best Buy is, well, a strong "Buy."
Christmas Tech Stocks to Buy - No. 3: Amazon.com
This Christmas, Amazon.com Inc. (Nasdaq: AMZN) CEO Jeff Bezos has a plan to overcome some holiday sales resistance.
He understands all too clearly that last-minute shopping online at Christmas often boils down to simple logistics. Can the gift get to where it needs to be in time for it to be opened by the recipient?
That's one of the reasons why Bezos recently unveiled Sunday delivery via the U.S. Postal Service. Technically speaking, it won't be a game changer this year because Christmas falls on a Wednesday.
But it does show customers that the world's largest online retailer is absolutely committed to getting packages out as promptly as possible.
Meantime, Amazon finds itself in a unique competitive position for prized Christmas tech products. While it sells tablet computers from Apple and those using Google's Android operating system, it also competes directly with both firms.
This Christmas, the company is heavily marketing the HDX version of its own Kindle Fire tablet that comes with 16 gigabytes of storage, Wi-Fi connectivity, and a 7-inch color screen. Amazon says the screen's resolution rivals that of top game consoles.
But technical support may be a bigger sales hook. The Kindle has a push-for-support button on the home screen. And the service is free.
Amazon began featuring the device in early November as part of a heavy marketing blitz for Black Friday, the big shopping bonanza held the day after Thanksgiving.
Despite the intense competition last year, I expect Amazon to do well again this Christmas - in particular because of the Kindle.
Amazon didn't release data but said that last year the tablet was the No. 1 product sold across all categories.
And the breadth of Amazon's product offering is impressive. I mean, just look at the sales stats for last year's "Cyber Monday," the Monday that follows the Thanksgiving weekend and "Black Friday."
Cyber Monday is becoming a huge online shopping day, and last year was no exception: The company sold a total of 26.5 million products in a single day.
And although Amazon sales results for Cyber Monday 2013 are not yet available, online sales in general for Cyber Monday enjoyed a 21% increase over 2012, according to Bloomberg.
Amazon.com, too, is a "Buy."
Christmas Tech Stocks to Buy - No. 4: Google
For Google Inc. (Nasdaq: GOOG), the world's most-dominant search-engine firm, this is going to be a $12.5 billion Christmas.
That's how much Google spent last year to acquire handset-maker Motorola Mobility Holdings Inc. This will be the first holiday season that consumers can actually buy Google-built phones.
But even before that deal came together, Google dominated the smartphone business through its Android operating system.
Google used Android to set up an entire ecosystem of devices made by other firms to steal market share from Apple.
The strategy worked, and today Android is the clear leader. Google says it is activating 1.5 million Android devices a day, with total sales of more than 1 billion units.
Market research firm IDC says Android devices accounted for 81% of the market in this year's third quarter.
This Christmas, I expect Google to begin picking up market share against Samsung, which IDC says still accounts for 40% of all Android phones sold in the United States.
The truth is that Google packed the Moto X with lots of features like voice control and easy customization and the ability to sense the difference between when you are in a meeting or stuck in traffic.
Either way, Google remains in an enviable position. Most of its top hardware competitors use its software to power their devices.
Google is the fourth of my holiday "specials," and is a definite "Buy."
Now then, each of these four tech stocks to buy are poised to have strong sales gains at Christmas.
And that means they will post excellent financial results for this all-important quarter - a three-month period that can make or break a company's sales and profits for the full year.
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About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.