Nasdaq Hits All-Time High: 5 Top-Ranked Tech Stocks to Buy

The Nasdaq hit a new all-time high on Jul 17, as tech stocks rallied once again. This is also the third time that the Nasdaq has hit a record high this month. The new high comes within a week after President Donald Trump’s fresh threats of imposing tariffs on additional $200 billion worth of Chinese goods. Understandably, investors are fending of trade war fears and have started showing faith in tech stocks once again.

Tuesday’s gain once again proves that investors believe tech stocks are less susceptible to tariffs compared to industrials. Also, tech stocks have been one of the best performers on the market this year. Given this scenario, investing in tech stocks looks like a profitable option. 

Tech Stocks Help Nasdaq Hit Record High

Markets ended sharply higher on Jul 17, with the Nasdaq hitting an all-time high. The Nasdaq added 49.40 points, gaining 0.6% to close at 7,855.12 points. The high was primarily boosted by a rally in tech stocks, led by Amazon.com, Inc. (AMZN), Alphabet, Inc. (GOOGL) and Facebook, Inc. (FB).

Amazon’s surge was attributable to the robust sales the company generated in the first 12 hours of Prime Day. Shares of Netflix too rebounded and closed just 5.2% lower. The company’s shares had initially fallen as much as 14.1% after it reported weaker-than-expected new subscriber additions.

Techs tocks have been the second best performer this year, with Technology Select Sector SPDR (XLK) gaining 14% on a year-to-date basis. It goes without saying that investors have started believing once again that tech stocks are poised to perform well in the days to come.

Investors Shed Trade War Fears

Trade war fears have been taking its toll on markets. Tech stocks too weren’t spared. However, investors have finally started believing that tech stocks aren’t as susceptible to trade war fears as industrials. This was enough to spark a rally in tech stocks.

Moreover, the Nasdaq’s new high comes within a week of Trump threatening fresh tariffs on $200 billion worth of Chinese goods. However, the tariffs don’t seem to have dented investors’ confidence much. Instead, investors have started fending off tariff fears and focusing more on individual sectors, giving tech stocks a thrust.

Moreover, analysts believe that trade war fears are temporary and the effect may be felt only in the medium or long term. Also, China’s limitations in building its own tech industry might restrict it from acting against U.S.-based tech players.

Our Choices

Trade war fears have been taking its toll on markets but investors finally seem to be shrugging these off. Moreover, the Nasdaq hitting a new high, the third time in this month, hints at investors’ confidence getting reinstated in tech stocks.

This makes it an opportune time to invest in tech stocks. However, picking winning stocks may be difficult.

This is where our VGM Score comes in. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores. Such a score allows you to eliminate the negative aspects of stocks and select winners. However, it is important to keep in mind that each Style Score will carry a different weight while arriving at a VGM Score.

We have narrowed down our search to the following stocks, each of which has a Zacks Rank #1 (Strong Buy) and a good VGM Score. You can see the complete list of today’s Zacks #1 Rank stocks here.

Micron Technology, Inc. MU has established itself as one of the leading worldwide providers of advanced semiconductor solutions.

Micron has a VGM Score of A. The company’s projected growth rate for the current year is more than 100%. The Zacks Consensus Estimate for the current year has improved 6.2% in the last 60 days.

Intel INTC is one of the world's largest semiconductor chip maker.

Intel has a VGM Score of B. The company’s projected growth rate for the current year is 16.5%. The Zacks Consensus Estimate for the current year has improved 4.7% in the last 60 days.

Diodes Inc. DIOD is a leading manufacturer and supplier of high-quality discrete and analog semiconductor products, primarily to the communications, computing, industrial, consumer electronics and automotive markets. 

Diodeshas a VGM Score of A. The company’s projected growth rate for the current year is 49.6%. The Zacks Consensus Estimate for the current year has improved 2.5% in the last 60 days.

Science Applications International Corp. SAIC is engaged in transaction, technical, engineering and enterprise IT services business. 

Science Applications International has a VGM Score of B. The company’s projected growth rate for the current year is 26.4%. The Zacks Consensus Estimate for the current year has improved 4% in the last 60 days.

Vishay Intertechnology, Inc. VSH is one of the world's largest manufacturers of discrete semiconductors (diodes, MOSFETs, and infrared optoelectronics) and passive electronic components (resistors, inductors and capacitors). 

Vishay has a VGM Score of A. The company’s projected growth rate for the current year is 29.4%. The Zacks Consensus Estimate for the current year has improved 3.9% in the last 60 days.

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SCIENCE APPLICATIONS INTERNATIONAL CORPORATION (SAIC) : Free Stock Analysis Report
 
Diodes Incorporated (DIOD) : Free Stock Analysis Report
 
Intel Corporation (INTC) : Free Stock Analysis Report
 
Micron Technology, Inc. (MU) : Free Stock Analysis Report
 
Vishay Intertechnology, Inc. (VSH) : Free Stock Analysis Report
 
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