The recent selloff in tech stocks pushed Jefferies senior tech analyst Brent Thill into cutting his price target on roughly 70% of the companies in this sector. But is it possible that the dip in tech stocks poses a good buying opportunity, especially since some of the top stocks are now down more than 20%? Commenting on it, Thill said on CNBC’s “Power Lunch”:
“Right now, there’s just a buyers’ strike, no one wants to be in the group. And typically, when no one wants to be in the group, that’s the time to start to buy.”
Tech could slide another 10% to 15%
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Thill acknowledged that tech could slide another 10% to 15% before it bottoms out but highlighted names like Intuit, Microsoft, Adobe, and Wix that, he said, had the potential to outshine the sector at large. The analyst said:
“It’s not about owning the entire group; it’s about owning these select names. Don’t back up the truck on the entire group.”
The tech-heavy Nasdaq Composite tanked to a low of 13,078.19 on Wednesday. The stock market index, however, recovered sharply on Thursday and is trading at 13,538.50 at the time of writing – roughly 5% down compared to its year-to-date high in the last week of April. Nasdaq had started the year 2021 at a lower 12,698.45.
Wedbush’s Ives sees the recent pullback in tech as just a dip
With over twenty years of experience in covering tech stocks, Dan Ives of Wedbush Securities also reiterated on CNBC’s “Squawk Box” that he sees the recent pullback in tech stocks as a ‘dip’ and not a ‘slide’.
“We stand by our multi-year bull thesis on tech. I think in the second half of the year, tech stocks will be up 15% to 20%.”
Ives named Microsoft that is focusing on leveraging the power of cloud as his top pick and also expressed confidence in Apple Inc. that has already started recovering from last week’s low. Last week, Paul Meeks of Independent Solutions Wealth Management also recommended to ‘not give up’ on tech stocks.
In the cybersecurity space, the Wedbush analyst sees potential in names like Zscaler, Cyberark, Sailpoint, Tenable, among others. After the Colonial Pipeline incident, Ives added, the significance of cybersecurity is evident, and the demand is not likely to go away.
Lastly, Ives picked Uber and Lyft as two of the best recovery bets that investors can place in the market.