CHICAGO (CNN/Money) -
Tech fund manager Kevin Landis has developed a tough hide and a gallows sense of humor. But two years into a rip-roaring Nasdaq downdraft, he's hanging onto his optimism -- even if it's by his fingertips.
Landis, manager of the $1.1 billion Firsthand Technology Value Fund, said he's upbeat about the prospects in digital photography, home entertainment and cell phones.
"Companies that can survive the downturn will reap the rewards," Landis said at the Morningstar Investment Conference on Tuesday.
More than 1,000 fund managers, fund executives and investment advisers are attending Morningstar's 14th annual conference. The mood has been decidedly grim as the fund industry faces a wave of shareholder discontent due to plummeting returns.
Kevin Landis of Firsthand Technology Value Fund. (Photo: Firsthand Funds)
Landis began his session as a speaker with a scene from "The Maltese Falcon," to demonstrate the type of investor feedback he's been getting. In the clip, Peter Lorrie screams to another character in the movie: "You imbecile! You bloated idiot! You stupid fat head!" The crowd laughed, but not that loudly.
Landis followed with a quote from poet William Blake: "If a fool would persist in his folly, he would be wise."
"A lot of the businesses are experiencing pain, but you have to take the longer-term view," he said.
Indeed. Landis is founder of the Firsthand family of funds, which includes the flagship Technology Value, down 45.6 percent year-to-date as of Jan. 25.
But Landis came armed with flow charts and graphs showing the potential for meteoric cell phone growth in underdeveloped wireless markets in Asia and Eastern Europe.
"It will be dysfunctionally stunning if we don't see growth in the next five years," Landis said.
He also pointed to the development of gadgets that nobody expected but that nobody can now live without: items such as pagers, microwaves, ATMs and voice mail.
"There are more of these things to come," he said.
More stories from Morningstar
| || ||
|| || |
Among his favorite holdings now is Kopin Corp (KOPN: Research, Estimates)., a maker of specialty wafers for semiconductors and microdisplays used in viewfinders for products such as video recorders.
Landis also downplayed problems with another favorite, Genesis Microchip (GNSS: Research, Estimates), which makes chips used in computer monitors and digital television sets. The company lowered its revenue guidance on June 13 to $41 million to $43 million from a previous estimate of $60 million. The company blamed the expected shortfall on an inventory buildup.
But Landis pointed out that $43 million would still be more revenue than the company has ever made. He said the company "is in the right place at the right time," but the question is whether management will be able to act on it.
"They're a good company, but you can't give them an A-plus," Landis said.