It is easy to say that investors should buy at low prices and sell at high prices, and you might think that the opportunity to do so has escaped you due to the notable recovery of the US stock market. USA Since its March low. But there are still opportunities in the most popular sector.
The information technology sector posted the best performance of the S&P 500 index this year. Trends, including collaboration in the cloud and software as a service, are impervious to blocking coronaviruses, or even accelerating. People who are just starting to work at home have had to upgrade their computers, peripherals and communications equipment.
But the IT sector includes many stocks that have dropped significantly, some analysts expect to rise in the next 12 months.
The S&P 500
SPX
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It reached a closing low in 2020 on March 23, when it fell 31% over the year. Since then, it has increased 28%, so it is down 11.2% this year until May 12. (All price changes in this article exclude dividends.)
Out of the 11 benchmark sectors, only information technology has increased this year:
| S&P 500 sector | Price change – 2020 | Price change – 2019 |
| Information technology | 1.9% | 48.0% |
| Healthcare | -2.4% | 18.7% |
| Consumer discretionary | -5.5% | 26.2% |
| Communication services | -5.8% | 30.9% |
| Basic consumer products | -8.9% | 24.0% |
| Utilities | -14.4% | 22.2% |
| materials | -17.0% | 21.9% |
| Immovable | -18.6% | 24.9% |
| Claims actions | -25.6% | 26.8% |
| Finance | -31.0% | 29.2% |
| Energy | -38.0% | 7.6% |
| Source: FactSet | ||
The impressive price increase for the year in the sector reflects the good performance of some very large companies (the S&P 500 is weighted by market capitalization). Six of this year's "technology winners" have a market capitalization of more than $ 100 billion:
| Company | Heart | Market capitalization (in millions of dollars) | Price change – 2020 | Price change – 2019 |
| Nvidia Corp. | NVDA |
191,984 | 33% | 76% |
| PayPal Holdings Inc. | PYPL |
165,567 | 30% | 29% |
| Microsoft Corp. | MSFT |
1,384,054 | sixteen% | 55% |
| Adobe Inc. | ADBE, |
175,906 | 11% | 46% |
| Salesforce.com Inc. | CRM |
159,682 | 9% | 19% |
| Apple Inc. | AAPL |
1,349,755 | 6% | 86% |
| Source: FactSet | ||||
Of the 71 IT S&P 500 stocks, 22 have tumbled at least 15% this year, and analysts polled by FactSet see double-digit upside potential of up to 89% in the next 12 months for 10 of them:
| Company | Heart | Price change – 2020 | Price change – 2019 | Closing price – May 12 | Target consensus price | Implied upside potential over 12 months |
| Micron Technology Inc. | MU, |
-fifteen% | 69% | $ 45.69 | $ 59.92 | 89% |
| Western Digital Corp. | WDC, |
-35% | 72% | $ 40.98 | US $ 61.82 | 67% |
| FleetCor Technologies Inc. | FLT |
-twenty one% | 55% | $ 228.46 | $ 272.22 | 47% |
| CDW Corp. | CDW, |
-29% | 76% | $ 101.98 | $ 116.86 | 44% |
| Microchip Technology Inc. | MCHP |
-18% | 46% | $ 85.99 | $ 102.79 | 43% |
| Motorola Solutions Inc. | M: YES |
-19% | 40% | $ 131.23 | $ 161.67 | 41% |
| Seagate PLC technology | STX |
-18% | 54% | $ 48.62 | $ 53.95 | 40% |
| Automatic data processing Inc. | ADP, |
-17% | 30% | $ 141.73 | $ 156.19 | 19% |
| Western Union Co. | WU |
-30% | 57% | $ 18.87 | $ 20.06 | 18% |
| Amphenol Corp. Class A | APH |
-22% | 3.4% | $ 84.27 | $ 94.00 | sixteen% |
| Broadcom Inc. | AVGO |
-fifteen% | 24% | $ 268.45 | $ 293.67 | fifteen% |
| Source: FactSet | ||||||
You can click on the tickers to get more information about each company.
You will have to scroll down to see all the data.
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