President Trump’s trade war with China, and the impeachment battle in Washington have kept volatility in the overall market, but the major indices remain near record highs. The NASDAQ is currently trading just 3.9% below its all-time high. As the trade war erupted, the tech sector got hit particularly hard, but as expectations of a potential deal have increased the sector has rebounded with several of the leaders in the sector rising to new highs.
Here are four tech stocks that have continued to show strength and should continue to reward investors during the final months of the year.
iPhone maker Apple (AAPL) is the top performer in the Dow Jones this year, with shares appreciating 45% on the year, and the stock trading at its all-time high. Apple has struggled with slowing iPhone sales, but the company has put increased focus on growing its services segment with impressive results. Last quarter the company’s services revenue grew 13% year over year, and as the company moves into the streaming market with Apple TV+ and the gaming sector with Apple Arcade, revenues should continue to rise.
Analysts are upbeat on the stock, which trades at $229.70 with an average price target of $228.52. If the company is able to deliver strong top and bottom line numbers when it next reports on October 30 analysts will ratchet up their price targets and allow AAPL to build on its recent gains.
Microsoft (MSFT) has been a top performer over the last five years, and MSFT stock is up 36% year to date in 2019. Microsoft’s position at the top of the cloud computing sector has driven the stock higher. Cloud computing is the fastest growing sector of tech as Microsoft has climbed its way to the top of the sector earnings have appreciated 17.6% per annum over the last five years and looking ahead analysts expect the company to show continued earnings growth at an annual pace of 14.5% over the next five years.
MSFT has traded sideways over the last three months and remains just shy of its all-time stock price of $142.37 at $138.00. Analysts have an average price target of $151.72 on the stock. The company has posted better than expected earnings and sales the last two quarters and will next report on October 23 with the consensus calling for $1.25 per share, up from $1.14 during the same period last year.
Search engine leader Alphabet (GOOGL) has risen 16.5% in 2019, and the stock is now trading in the upper end of its 52-week high and just 6% below its all-time high. Google has long been the king of search, and it remains the leader of the pack, with just Facebook (FB) able to pose any threat. Google is a mature company at this point, but it continues to grow with profits up 16% per annum over the last five years and analysts expect earnings to continue to grow at an annual rate of 12.5% over the next five years.
GOOGL sold off sharply in late April after the company posted negative surprises on the top and bottom line, but the stock found support at the start of the summer and has trended higher the last four months due in part to a strong quarterly report at the end of July. The company will next report earnings October 24 with the consensus calling for earnings of $12.55 versus $13.05 during the same period last year. The stock trades at $1,212 with an average price target of $1,379.06.
Facebook (FB) has been a strong outperformer in since going public, and FB has risen 38% in 2019 and is currently trading 13% below its 52-week high which it hit in mid-July. Wall Street has remained bullish on the social media giant despite its privacy concerns because of the company’s tremendous reach and the large moat it has around its business.
Facebook has around 2.7 billion monthly active users, which accounts for an amazing 36% of the world’s population. There is no denying the company’s reach, and this makes it very appealing to advertisers. Facebook has emerged as the only company that can compete with Google’s online advertising machine.
The company continues to grow at a rabid pace, with estimates calling for profits to rise 22% per annum over the next five years. Facebook needs to improve its image and provide greater assurances of user privacy, but its size and scope have cemented its place at the top of social media and keep the company growing in the years to come. FB trades at $180 with an average price target of $227.76.