The investor rotation away from technology stocks is expected to be short-lived owing to the unabated demand for advanced technology products and services. Therefore, we think some of the biggest names in the tech industry, specifically Intel (INTC), International Business Machines Corporation (NYSE:), Panasonic (OTC:), and Canon (CAJ) are solid bets at their current price levels. Read on for an explanation.The digital transformation by businesses during the COVID-19 pandemic powered the tech sector to a rocket-like rally last year. This is evidenced by iShares Global Tech ETF’s (IXN) 41.8% returns in 2020. However, the economic recovery this year has motivated investors to bail out of expensive tech stocks in favor of potential post-pandemic winners. This has resulted in a selloff of tech stocks.
However, the adoption of hybrid working models by many companies during the pandemic, combined with huge demand for cloud services, cybersecurity and connected devices and sensors, and rising interest and investments in the 5G technology and artificial intelligence (AI), make analysts predict the global information technology market will hit $11.87 trillion by 2025, representing a 9% CAGR.
Given this outlook, we believe Intel Corporation (NASDAQ:), International Business Machines Corporation ( IBM ), Panasonic Corporation (PCRFY), and Canon, Inc. (CAJ) are well positioned to deliver solid returns in the coming months.
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