Big Tech Stocks Like Microsoft and Nvidia May Fall. But Don’t Worry About It That Much.

June 1, 2023

Big Tech Stocks Like Microsoft and Nvidia May Fall.

Big tech stocks have had an incredible run, and you may be tempted to sell them in order to prevent the inevitable falls.

Hold on to them if you’re a long-term equities investor. When you consider how rapidly earnings are expanding, some of the largest firms out there, from Microsoft (MSFT) to Nvidia (NVDA), are still reasonably valued.

The Nasdaq 100 index, which includes just over 100 of the Nasdaq Composite’s top non-financial businesses, is up almost 34% from its bear market trough in late December. The S&P 500 stock index is up 9% year to date, while the Vanguard S&P 500 Value Index Fund ETF (VOOV) is up only 4%.

For example, big tech stocks such as Meta Platforms (META) have nearly doubled from its bottom in the second half of 2022, while Alphabet (GOOGL) is up roughly 50%. Nvidia and Microsoft have more than doubled and are up approximately 55%, respectively, from their lows in late 2022. These firms are incorporating artificial intelligence into their products and extending their service markets while dropping bond rates have increased their values.

In comparison to the Russell 2000, the Nasdaq 100 is now valued around eight times as much as it was a few months ago. The last time the Nasdaq 100 outperformed the Russell 2000 was in 2020, when historically low interest rates increased the value of growth stocks and Covid-related regulations kept people indoors and in front of screens, driving up revenue for streaming, social media, and work-from-home essentials like the cloud.

Technology wasn’t pleased with that. Interest rates increased due to higher inflation, and people started spending more time outside the home as the epidemic receded, which resulted in a decline in tech income. For the most of 2021 and 2022, the Russell 2000 outperformed the Nasdaq 100. But perhaps things will go differently this time. The long-term forces driving tech are still in place, even if it is anticipated that the performance of tech companies would wane and investors may find better possibilities in particular market segments.

According to FactSet, analysts at Nvidia, Microsoft, Meta Platforms, and Alphabet forecast double-digit earnings-per-share growth for several years. Meanwhile, while values are high, they are not out of control.

Alphabet and Meta are trading at little more than 20 times the projected EPS for the next year, which is less than two times their predicted annual EPS growth rates for the next several years. While Nvidia and Microsoft are trading at 48 and 30 times profits, respectively, that is still less than two times the forecast EPS growth. These aren’t outrageous pricing, given that the S&P 500 trades at 18 times earnings and expects EPS growth of only 8% over the next few years.

The road ahead for big tech stocks will not be easy — it seldom is. According to technical experts, there may be a lack of buyers because fund managers have piled up on tech companies and are unwilling to take any more risk at higher prices. Indeed, tech equities have finally bottomed out in recent trading days.

However, unless you believe that advances such as artificial intelligence aren’t here to stay, tech stocks will resume their upward trend. Maintain your current path of action.

Subscribe Our Newsletter

Subaru Recalls 270 000 Vehicles

Alexander

Subaru Recalls 270 000 Vehicles Over Fire Risk

Subaru warns drivers to park away from garages and carports, as well as urges owners to contact their local car retailer, as a manufacturing error can set the vehicle on fire.

Companies
Gold Holds Biggest Gain Since March on Persistent High Inflation
Gold Holds Biggest Gain Since March on Persistent High Inflation

As investors considered concerns about stubbornly high inflation and the imminent decrease in stimulus, gold held steady following its largest gain in seven months.

Banks and Finance
B2BROKER Liquidity B2BROKER Liquidity
Sponsored
Constantine

Top 5 Most Distinguished White Label Solutions in 2022
Any partnership in business is always individual in nature and has its own prerequisites. Someone is trying to find new channels and ways of development, someone comes to integrate with a partner not from a good life.

discover
What is Prime of Prime Liquidity?

Liquidity Provider

What is Prime of Prime Liquidity?

Let's find out why can’t brokers function without liquidity aggregation, what are the types of liquidity providers and what is Prime of Prime liquidity.

Liquidity
Contact us bg

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiries

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Сonstantine

    Best Crypto to Buy Now: Guide for Investors

    Best Crypto To Buy Now

    Hazem

    Grok vs ChatGPT: What’s the Best AI Assistant You Need in 2025

    Grok vs ChatGPT

    Сonstantine

    How to Choose the Right Liquidity Provider for Your Brokerage

    How to Choose the Right Liquidity Provider for Your Brokerage

    Сonstantine

    Low-Latency Trading Defined: Speed, Strategy and Technology

    Low-Latency Trading Explained

    Hazem

    How Liquidity Depth Affects Slippage in High-Volume Trading

    Liquidity depth and slippage in trading

    Hazem

    What is FIX API Liquidity Connection and How Does it Power Institutional Trading?

    FIX API in institutional trading

    Сonstantine

    OTC Trading Strategies and Technologies to Succeed in Over-the-Counter Markets

    OTC Trading Strategies

    Alexander

    What is OTC Trading? A Complete Guide for 2025

    what is OTC

    Alexander

    Synthetic Futures: A Trader’s Guide to Replicating Positions with Options

    How to Trade Synthetic Futures

    Сonstantine

    Order Book Depth: What It Is And Why It Matters?

    Order Book Depth What It is And Why It Matters

    Alexander

    Spot vs Perpetual Futures: Which Is Right for You?

    Spot vs Perpetual Futures explained

    Hazem

    5 Reasons Traders Are Switching to Perpetual Futures

    5 Reasons to Switch to Perpetual Futures

    Constantine

    Top 3 Liquidity Challenges Facing New Exchanges and How to Solve Them

    Top 3 Liquidity Challenges Facing New Exchanges Today

    Constantine

    Financial Planning in the Cryptocurrency Era — Master Crypto and Digital Asset Strategies

    Financial Planning in the Cryptocurrency Era

    Hazem

    Best Platforms to Trade Perpetual Futures in 2025

    Best platforms to trade perpetual futures in 2025

    Alex

    Top 10 Fintech Website Development Agencies for 2025

    Best Fintech Website Development Agencies for 2025

    Сonstantine

    Internal vs External Range Liquidity In ICT Trading Explained

    Internal vs External Range Liquidity In ICT Trading

    Constantine

    Portfolio Backtesting — Tools, Metrics, and Methods Explained

    Portfolio Backtesting

    Сonstantine

    ICT Trading Explained: Smart Money Concepts, Tools and Setups

    ICT Trading Explained

    Сonstantine

    CFD Trading Strategies: A Practical Guide to Risk and Execution

    CFD Trading Strategies

    Alexander

    What is a Fair Value Gap? A Guide to Trading Market Imbalances

    What is Fair Value Gap

    Vitaliy

    Triangle Patterns in Trading: Mastering Ascending, Descending & Symmetrical Strategies for Maximum Profit

    Triangle Patterns in Trading: Ascending, Descending & Symmetrical Guide

    Alexander

    What Is COTI? Payments, Token & Price Prediction

    What is a COTI coin

    Constantine

    Best Copy Trading Software in 2025

    Best Copy Trading Software in 2025
    liquidity-provider-logo
    • News
      • Stock Market Forecast
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
      • White Label Brokerage Platforms
      • Broker CRM Platforms
    [email protected]

    © 2024 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site. Switch to a production site key to remove this banner.