6 S&P 500 Tech Stocks To Soothe A Coronavirus-Scarred Portfolio
Zacks Investment Research | Mar 26, 2020 08:27AM ET
The coronavirus pandemic has been devastating for global stock markets including three major U.S. indices, namely Dow Jones, S&P 500 and Nasdaq. The unabated panic selling pushed all the three indices into the bear market territory, marking the fastest downside in history.
However, based on the $2-trillion stimulus package from the US government, the indices recovered handsomely on March 24. The Dow rallied 2,112.98 points or 11.37%, recording its biggest single-day gain after 1933. (Read More: US Government Reaches Deal on Stimulus Package: 5 Top Picks )
The S&P 500 and Dow Jones were up more than 1% and 2%, respectively, on Mar 25. Markedly, for the first time since Feb 12, the S&P 500 climbed on two consecutive days. The Dow's 14% gain over the successive sessions was also its strongest two-day performance since 1987.
Nevertheless, the overall market rally was mixed as several senators threatened to delay a vote. The stimulus package eventually got Senate’s approval by a voting ratio of 96-0 and sent it to the House of Representatives, which is likely to vote on Friday.
Tech Stocks to Stay Afloat From Possible Market Recovery
Although the economic impact of the pandemic coronavirus is still unfathomable, Senate’s approval of the stimulus package definitely boosts investors’ morale who are having a tough time wading through the market turbulence.
Investors looking to ride on a possible stimulus-led rebound should park money in stocks that are fundamentally strong with solid prospects.
Technology stocks remain attractive owing to consistent digital transformation in the sector. Rapid adoption of cloud computing along with the ongoing infusion of AI and machine learning as well as the accelerated deployment of 5G technology, blockchain, IoT, autonomous vehicles, AR/VR and wearables are major tailwinds.
Here we pick six tech stocks that apart from boasting strong fundamentals carry either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see Microsoft Corporation Quote
Qorvo (NASDAQ:QRVO) is benefiting from the robust adoption of its wireless connectivity, base station and Gallium Nitride (GaN) technology-based solutions. Moreover, this Zacks #1 Ranked company’s expanding portfolio of 5G solutions amid accelerated deployment of 5G is a key catalyst.
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The Zacks Consensus Estimate for Qorvo’s fiscal 2021 earnings stands at $6.07 per share, having moved 6.7% north over the past 60 days. Earnings are expected to grow 5.4% from the figure reported in the preceding year.
NVIDIA (NASDAQ:NVDA) is gaining traction from strong growth in GeForce desktop and notebook GPUs, which is aiding its gaming revenues. Moreover, an uptick in Hyperscale demand is a tailwind for this Zacks #2 Ranked stock’s data-center business. Additionally, ray-traced gaming, rendering, high-performance computing, AI and self-driving cars are key growth prospects.
The consensus mark for NViDIA’s fiscal 2021 earnings has increased 8.8% to $7.65 over the past 60 days, suggesting growth of 32.1% from the year-ago reported figure.
Advanced Micro Devices (NASDAQ:AMD) , based on the robust adoption of its Ryzen, Radeon and latest second-gen EPYC server processors, gained a significant traction across high-performance PC, gaming and data center markets. All these spaces benefited from the coronavirus-induced social distancing that led to buoyancy in demand for gaming and work-related laptops plus PCs.
Moreover, the growing clout of GPUs driven by the increasing adoption of AI techniques and machine learning tools in industries like gaming, automotive and blockchain holds promise for this #2 Ranked stock.
The consensus mark for fiscal 2020 earnings is pegged at $1.10 per share, having moved 1.9% north in the past 60 days. Earnings are expected to soar 71.9% from the prior-year reported number.
Lam Research (NASDAQ:LRCX) is benefiting from continued strength in logic and foundry spending. Transition to new data-enabled economy, in which DRAM and NAND continue to ride on density growth, is also favoring this Zacks Rank #2 company’s prospects. Moreover, sturdy adoption of 3D architecture is driving its non-memory segments.
The consensus mark for fiscal 2020 earnings stands at $16.35 per share, having been revised 7.5% upward in the past 60 days. Earnings are expected to grow 12.4% from the figure reported last year.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.5% per year.
These 7 were selected because of their superior potential for immediate breakout.
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