- The past year has not been kind to tech stocks as we have seen even the biggest tech companies (Apple, Microsoft, Meta) drop dramatically in market capitalization.
- Many analysts are optimistic about the future of technology stocks due to the growing demand for cloud-based services and the possibility that consumer spending will return to normal if we avoid a recession.
- We still have to look at macroeconomic factors because we are not clear yet when it comes to avoiding a recession.
It’s no secret that 2022 has been a volatile year for the economy as a whole and for the stock market. We’ve seen some of the biggest companies drop in value as rising inflation and rising interest rates trigger a series of investor sell-offs. Fears of a possible recession.
This means that many of the big tech stocks are priced surprisingly low, and this market drop could be the perfect opportunity to invest in these giant companies. We’ll take a look at the top tech stocks to buy right now.
What are the top tech stocks to buy right now?
We decided to look at tech companies that depreciated in value last year but could be considered a good investment if the economy turns around. All of these are the tech giants who are counting on the macro economy to improve this year.
This tech giant has seen a significant drop in stocks in 2022 due to the usual macroeconomic factors as well as production issues. Apple has had to deal with factory issues in China that have slowed delivery of its latest iPhones. The stock price is currently declining as of this writing, and the market cap has fallen below $2 trillion because investors are concerned about iPhone supply chain disruptions and lower demand for the new product.
However, the company is still in solid financial shape, and there are rumors of a major new product line in the form of an AR/VR headset that could be launched in 2023. When we wrote about it apple stock We noted earlier that the company reported record revenue for the last quarter of $90.1 billion during a time when other companies were struggling to turn a profit. Strong iPhone and Mac sales helped the company achieve this revenue record.
Apple shares closed at $134.76 on January 13, 2023, and the stock has a one-year price target of $176.20.
The company is expanding its services and moving into business. While Microsoft is best known for its Office products, Azure cloud services are also emerging, and cloud-based businesses make up nearly two-thirds of the company’s total revenue. Microsoft brought in $20.3 billion last quarter from cloud services, and this segment is expected to continue to grow as the world completes its digital transformation.
Analyst John Freeman expected Microsoft’s operating margin to reach 50% in 2023, up from 42% in 2021, with a compound annual growth in revenue of 15%.
Microsoft shares closed at $239.23 on January 13, 2023, and the one-year price target per share is $296.91.
NVIDIA Corp (NVDA)
Nvidia is known for selling and designing high-end graphics cards and video processing chips for the computer game industry. They are known for creating stunning visual effects for games with the most advanced options available today, which makes their chips popular among developers and video game enthusiasts.
Despite the popularity of its products, the company saw its shares drop by half in 2022 as consumer fears of a recession sent many tech companies down over the course of the year. The company lost revenue due to issues with the cryptocurrency space. Many analysts feel that Nvidia stock could rebound in 2023 due to the booming cloud-based data center business and the possibility of a comeback in the gaming industry in 2023.
It should be noted that the data center business brought in more than $10 billion in revenue for fiscal 2022. As companies continue their digital transformation, there is optimism that this will mean increased demand for Nvidia chips.
Nvidia shares closed at $168.99 on January 13, 2023, and the one-year share price target is $195.83.
Adobe Inc. (ADBE)
When collapsed how Adobe makes moneyWe note that 93% of the company’s revenue came from the subscription segment. Adobe generated $15.785 billion in annual revenue in 2021, up 22.67% from 2020. In the third quarter of 2022, the company reported record revenue of $4.43 billion, representing 3% year-over-year growth. . With long-term enterprise contracts and popular design tools combined with cloud-based services, the company is likely to continue to grow in 2023. A key business point to look for is the proposed $20 billion acquisition of Figma. Regulators could still block this purchase, but if it did, it would be another game-changer for the power of digital media programs and marketing.
Adobe shares closed at $344.38 on January 13, 2023, and the one-year price target per share is $386.17.
PayPal It remains the leading digital payment processing company, and the service is used globally. What makes this tech stock a buy is that shares are down nearly 60% while the company remains a very profitable business. Although current issues with inflation and fears of a recession may have hurt trading volumes, the company is positioned to benefit when the economy picks up. With the burgeoning buy-now-pay-later program and the addition of cryptocurrency, PayPal, with its 432 million customer base worldwide, should be a stock to watch.
PayPal shares closed at $74.48 on January 13, 2023, with a one-year price target of $105.83 per share.
Here are some other notable tech stocks to watch out for in 2023:
- Meta platforms. This stock is down sharply in 2022, with shares down about 64% from last year. However, there are hopes that ad spending will increase in 2023 if we avoid a recession.
- Master Card Credit Card. While Mastercard is not a technology stock, the company does have experience in the technology industry. If that field bounces back, the credit card company will be even bigger.
- Accenture. The consulting and outsourcing company has had some issues in 2022 regarding currency, Russia’s invasion of Ukraine, and other macroeconomic factors. However, they’ve continued to deliver a solid balance sheet and a track record of solid earnings growth. They’ve also worked towards an attractive talent pool.
As always, these are just tech stocks worth watching, and there are no guarantees that any of these stocks will rise in 2023. We recommend that you do your due diligence and invest accordingly.
Should you invest in tech stocks?
The harsh reality is that investors, analysts, and policymakers pay close attention to inflation data and other reports when they surface to determine the current state of the economy. The goal of the Fed’s large interest rate increases was to slow the economy enough to lower prices again for consumers. During this process, there are usually many casualties because consumers are less inclined to spend money on discretionary purchases, which means tech companies have to report lower earnings.
It is anyone’s guess what will happen to the stock market and the technology industry in 2023. However, many analysts predict that despite the bleak year 2022, this new year will present a different situation. R “Ray” Wong, an analyst from Constellation Research, told Yahoo Finance that he felt 2023 would be much better since many tech giants are in a position to take advantage of the growing cloud-based industry. He noted that companies like Apple will see improvements as China opens up again.
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