13 Best Big Tech Stocks To Buy Now
In this article, we will be taking a look at the 13 best big tech stocks to buy now. To skip our detailed analysis of the technology industry and current developments within it, you can go directly to see the 5 Best Big Tech Stocks To Buy Now.
The technology industry has seen a stellar 2023 so far, with most investors viewing this sector as the market's savior amidst inflation concerns. Part of the reason why tech has been doing so well is, of course, the current artificial intelligence (AI) boom. Most tech companies of significance today are making significant headway in the field of AI as the corporations of the world take part in a global AI arms race. No tech company wants to be left behind in the face of this rapidly transforming market as AI continues to revolutionize the tech industry like the Internet did in 1995. As such, some of the best large-cap tech companies today are going above and beyond to compete in the AI race and make profits for themselves and for their investors along the way.
While investing in AI is considered to be the best way to invest in big tech in general by many investors, it isn't the only thing of interest going on in the big tech regime. Another thing to keep an eye on is the rapidity with which many major big tech companies are continuing to grow and assert their dominance in the market, apart from their AI endeavors. One example is Microsoft Corporation's (NASDAQ:MSFT) recent deal to acquire Activision Blizzard, Inc. (NASDAQ:ATVI) for approximately $69 billion. Those concerned about the rapid growth of big tech companies, like the Federal Trade Commission (FTC), have been opposed to this deal. However, on July 14, an appellant court judge in the US denied the FTC's bid to delay this deal, leaving Microsoft Corporation (NASDAQ:MSFT) free to continue its expansion. On July 17, CNBC invited Big Technology founder Alex Kantrowitz to discuss this deal when he noted the following:
"I think it is priced in. I think that the markets have been watching what's been going on here and they've come to the conclusion that Microsoft's gonna win, probably in the last few weeks. So you'll see a small bump when this thing actually goes through but the real impact is gonna be long term, like let's see how Activision actually adds to the Microsoft set of gaming tools and it actually might end up impacting the business in the bottomline because once you put those two together there could be some significant growth. Some of these concerns that people have been bringing that Microsoft might corner off the competition or the Xbox might end up taking exclusivity on some of these games, that could actually come to fruition now and once that happens we could see something serious with the stock."
This type of expansion is something that is been seen across the tech industry in many companies in the form of deals, partnerships, and acquisitions, among much more. Many of these expansions are also relevant to the field of AI as tech companies continue to jump on the AI bandwagon this year. Due to all this, other renowned tech companies like Advanced Micro Devices, Inc. (NASDAQ:AMD), Adobe Inc. (NASDAQ:ADBE), and ServiceNow, Inc. (NYSE:NOW) are also setting the stage for themselves to join the big tech cohort of companies. Considering the popularity of the tech industry in 2023, many of these companies may even become some of the best long-term tech stocks to buy right now. Some may even be classified as undervalued tech stocks considering their future potential and current valuation. Keeping this in mind, we have compiled a list of the best big tech stocks to buy now.
Photo by Alexandr Bormotin on Unsplash
Our Methodology
We picked large-cap tech stocks that are highly popular among hedge funds in 2023 for our list below, using Insider Monkey's hedge fund data for the first quarter when 943 hedge funds were tracked. They are ranked based on the number of hedge funds holding stakes in them, from the lowest to the highest number.
Best Big Tech Stocks To Buy Now
13. Oracle Corporation (NASDAQ:ORCL)
Number of Hedge Fund Holders: 67
Oracle Corporation (NASDAQ:ORCL) is a systems software company based in Austin, Texas. It offers products and services addressing enterprise information technology environments globally. The company is considered to be part of the big tech cohort because of its widespread influence in the industry.
Mark Murphy, an analyst at JPMorgan, holds an Overweight rating on Oracle Corporation (NASDAQ:ORCL) shares as of June 13. The analyst also raised his price target on the stock from $109 to $112.
Oracle Corporation (NASDAQ:ORCL) was spotted in the portfolios of 67 hedge funds during the first quarter, with a total stake value of $2.9 billion.
Sciencast Management was the largest shareholder in Oracle Corporation (NASDAQ:ORCL) at the end of the first quarter, holding 3,950 shares in the company.
Ariel Investments mentioned Oracle Corporation (NASDAQ:ORCL) in its first-quarter 2023 investor letter:
“Additionally, global leader in enterprise software, Oracle Corporation (NYSE:ORCL) traded higher in the quarter, driven by solid quarterly earnings, a material increase in the dividend as well as forward looking guidance that implies a substantial acceleration in organic cloud growth for full year 2023. We believe these results highlight ORCL’s ability to effectively cross-sell and upsell apps and infrastructure, as well as the emergence of the company’s cloud platform as a competitive offering.”
Like Adobe Inc. (NASDAQ:ADBE), ServiceNow, Inc. (NYSE:NOW), and Advanced Micro Devices, Inc. (NASDAQ:AMD), Oracle Corporation (NASDAQ:ORCL) is also one of the most renowned tech companies in the world today, making it popular with hedge funds.
12. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 91
As of July 12, Matthew Ramsay at TD Cowen maintains an Outperform rating on shares of Advanced Micro Devices, Inc. (NASDAQ:AMD). The analyst also raised his price target on the stock from $150 to $160.
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a semiconductor company based in Santa Clara, California. The company provides x86 microprocessors and graphics processing units (GPUs), among more.
There were 91 hedge funds long Advanced Micro Devices, Inc. (NASDAQ:AMD) in the first quarter. Their total stake value was $4.9 billion.
Horizon Kinetics LLC said the following about Advanced Micro Devices, Inc. (NASDAQ:AMD) in its first-quarter 2023 investor letter:
“It is among what are considered to be the great technology companies, like Advanced Micro Devices, Inc. (NASDAQ:AMD) and Intel, that one is apt to see some of the greatest confusion between short-term financial results and share price movements, on the one hand, and long-term financial results. The former are exceedingly difficult to predict. Long term results are relatively easy to predict, because they are bound by the limiting realities of the business model. In the case of AMD, that is the business of being a large-scale semi-conductor manufacturer with a more dominant competitor that has a scale economy advantage.
Here’s what people see, remember and act upon. In the past several years, AMD has been the best performing major technology stock. It’s outperformed Apple, Amazon, Google, Meta (Facebook) and Nvidia…” (Click here to read the full text)
11. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 96
Holding 1.5 million shares in the company, GQG Partners was the largest shareholder in ServiceNow, Inc. (NYSE:NOW) at the end of the first quarter.
ServiceNow, Inc. (NYSE:NOW) is another systems software company on our list. It is based in Santa Clara, California. The company provides enterprise cloud computing solutions that define, structure, consolidate, manage, and automate services for enterprises internationally.
A total of 96 hedge funds held stakes in ServiceNow, Inc. (NYSE:NOW) during the first quarter, with a total stake value of $4.2 billion.
Jack Andrews, an analyst at Needham, initiated coverage on ServiceNow, Inc. (NYSE:NOW) shares on June 14. He also announced a $660 price target on the stock.
Here's what Lakehouse Capital said about ServiceNow, Inc. (NYSE:NOW) in its April 2023 investor letter:
“Despite a difficult macro environment, US-based software company ServiceNow, Inc. (NYSE:NOW) proved resilient with a healthy combination of organic growth and profitability. Subscription revenues grew 24% year-on-year (27% constant currency) to $2.0 billion and operating income grew 26% year-on-year to $552 million. The company’s core operating metrics were equally strong with remaining performance obligations growing 24% year-on-year and renewal rates holding firm at 98%. ServiceNow’s renewal rates are noteworthy as not only are they best-in-class but they are also remarkably consistent, typically in the range of 97% to 99%. They speak to the mission critical nature of the platform and are a key driver of long term annuity value. Overall, we continue to believe that ServiceNow is one of the highest quality software businesses around as the combination of consistent growth at scale, robust free cash flow generation and a large addressable market make it an attractive opportunity.”
10. Adobe Inc. (NASDAQ:ADBE)
Number of Hedge Fund Holders: 99
We saw 99 hedge funds long Adobe Inc. (NASDAQ:ADBE) at the end of the first quarter. Their total stake value in the company was $7.3 billion.
Keith Bachman at BMO Capital upgraded shares of Adobe Inc. (NASDAQ:ADBE) from Market Perform to Outperform on June 21. The analyst also announced a $570 price target on the shares.
Adobe Inc. (NASDAQ:ADBE) is an application software company based in San Jose, California. It operates software, solutions, and cloud-based document services, among more.
This is what Akre Capital Management said about Adobe Inc. (NASDAQ:ADBE) in its second-quarter 2023 investor letter:
“The Fund owns many businesses that stand to benefit enormously from A.I. Adobe Inc. (NASDAQ:ADBE) has released A.I.-powered “co-pilots” to make its software easier to use. The top five positive contributors to performance during the quarter were Moody’s, Mastercard, CoStar, Constellation Software, and Adobe.”
9. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 102
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) had 102 hedge funds long its stock during the first quarter, with a total stake value of $8.9 billion.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is another semiconductor company on our list. It is based in Hsinchu City, Taiwan, and manufactures integrated circuits and other semiconductor devices for sale globally.
Mehdi Hosseini at Susquehanna holds a Positive rating on shares of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as of July 14. He also raised his price target on the stock from $128 to $135.
Baron Funds made the following comment about Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its first-quarter 2023 investor letter:
“Semiconductor giant Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) contributed in the first quarter due to easing geopolitical concerns and expectations for end-demand recovery later in 2023. We retain conviction that Taiwan Semi’s technological leadership; pricing power; and exposure to secular growth markets, including high-performance computing, automotive, 5G, and IoT; will allow the company to sustain strong earnings growth over the next several years.”
8. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 128
Alibaba Group Holding Limited (NYSE:BABA) is a provider of technology infrastructure and marketing reach for merchants, brands, retailers, and businesses. It operates an e-commerce platform and is based in Hangzhou, China.
Alibaba Group Holding Limited (NYSE:BABA) was spotted in the 13F holdings of 128 hedge funds in the first quarter. Their total stake value in the company was $5.9 billion.
Colin Sebastian, an analyst at Baird, reiterated an Outperform rating on shares of Alibaba Group Holding Limited (NYSE:BABA) on July 17. The analyst also maintains a $115 price target on the stock.
Here's what Oakmark Funds said about Alibaba Group Holding Limited (NYSE:BABA) in its second-quarter 2023 investor letter:
“Alibaba Group Holding Limited (NYSE:BABA) (China) was the top detractor for the quarter. Sentiment in Chinese equities has degraded after the initial excitement from China’s reopening earlier in the year. Incremental macroeconomic data coming out of China indicates that the Covid-19 re-opening bounce is fading, and the economy is struggling to sustain healthy growth. Political tensions between the U.S. and China are also further weighing on investor sentiment. As the largest e-commerce platform in China, Alibaba’s share price has been caught up in this storm. The company has also continued to face intense competition from the likes of short video players and traditional e-commerce companies. Indeed, Alibaba has lost market share, which we expect will continue. But despite these negative factors, it remains an extremely important platform in China and continues to generate significant free cash flow. In the most recent completed fiscal year, the company generated $25B of free cash flow, which is 12% of the current market capitalization. Today, its core commerce business trades at approximately 5x EBITA, a valuation we deem much too cheap, even with the headwinds noted above. But valuation alone is often not enough to unlock value. Alibaba’s management team is proactively working for minority shareholders. The company has been aggressive with share repurchases and with the recent formation of a capital management committee. Our conversations with the company indicate there is a high probability that more shareholder returns will be coming. In addition, the company recently announced a major restructuring that will effectively break up the company and separately list various businesses within Alibaba. Today, the market is assigning little to no value to these businesses and having a market quote may force investors to give Alibaba value for these assets. Whether or not the restructuring works, we appreciate management’s efforts to help unlock value in what is clearly an undervalued stock.”
7. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 131
As of July 17, Erik Woodring, an analyst at Morgan Stanley, maintains an Overweight rating on shares of Apple Inc. (NASDAQ:AAPL). The analyst also raised his firm's price target on the stock from $190 to $220.
In total, 131 hedge funds held stakes in Apple Inc. (NASDAQ:AAPL) at the end of the first quarter, with a total stake value of $165.2 billion.
Apple Inc. (NASDAQ:AAPL) is one of the main big tech companies in the US market. It operates as a technology hardware, storage, and peripherals company and is based in Cupertino, California. The company is best known for its smartphone brand, iPhone.
The following is a comment from Manole Capital Management's second-quarter 2023 investor letter about Apple Inc. (NASDAQ:AAPL):
“Despite this, the S&P 500 is up 7% this year and the Nasdaq is up +11%. Technology rebounded from a challenging 2022 and many large tech companies are performing quite well this year. Through mid-May 2023, year-to-date performance of some of the most popular and largest names tech names is impressive. For tech companies with market capitalizations over $1 trillion, Apple Inc. (NASDAQ:AAPL) is up +35%, Microsoft +33%, Amazon +39%, and Google is +40%. In terms of contribution to the S&P 500’s year-to-date return, Apple and Microsoft represent roughly half of its 2023 performance. Apple, and Microsoft now account for 13.9% of the entire S&P 500 or 80% more concentrated than 2008. For additional perspective, Apple’s market cap is at $2.8 trillion and that is larger than the market cap of the entire Russell 2000. To conclude, it’s distinctly getting more concentrated at the top.
For our purposes, we are just going to focus on software digital wallets, as they are much more common and accessible. If you own an iPhone, then you have an Apple Pay pre-loaded digital wallet. If you have a Samsung phone, you have Samsung Pay available for use. Those two, along with Google Pay and PayPal, are the four most popular digital wallets today. According to the Payments Journal, PayPal has been used (over the last 12 months) by 62% of American consumers, followed by Apple Pay at 41% and Google Pay at 32%.
Digital wallets have tons of advantages, that we are embracing. When we attend Tampa Bay Lightning games, we love having our season tickets easily accessible on our phones (via the Apple Pay wallet), as well as our timed parking pass. When we travel, loading the airline ticket into our Apple Pay wallet is much more convenient than printing out a paper boarding pass. Others are using digital wallets to track their expenses, budget properly, and even help them easily pay their bills. Digital wallets are still in their infancy and have decades of future growth; we believe the smartphone is simply the best interface and platform for digital wallets…” (Click here to read the full text)
6. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 132
NVIDIA Corporation (NASDAQ:NVDA) is a leading semiconductor company. It is based in Santa Clara, California. The company's AI chips and GPUs have put it ahead of its competitors in the AI arms race so far.
Our hedge fund data for the first quarter shows 132 hedge funds long NVIDIA Corporation (NASDAQ:NVDA). Their total stake value in the company was $12.3 billion.
A Buy rating was maintained on shares of NVIDIA Corporation (NASDAQ:NVDA) by William Stein at Truist Securities on July 14. The analyst also raised his price target on the firm from $470 to $545.
ARK Investment Management was the most prominent shareholder in NVIDIA Corporation (NASDAQ:NVDA) at the end of the first quarter, holding 295,732 shares in the company.
This is what Artisan Partners said about NVIDIA Corporation (NASDAQ:NVDA) in its second-quarter 2023 investor letter:
“Top contributors to performance for the quarter included graphics semiconductor company NVIDIA Corporation (NASDAQ:NVDA). Nvidia rose after reporting strong results and forecasting significantly higher data center revenues for the coming quarter, driven by rising artificial intelligence investments around the world.
When we are successful in achieving disproportionate equity outcomes, we need a process for managing them. Entering this year, we had a ~6.5% position in Nvidia. Due to the enthusiasm for generative AI and a rapid conclusion to “cloud optimization,” the stock has surged 189.5% this year including 52.31% in Q2. We retained an investment in Nvidia with less capital at risk, an approach which afforded us the potential to prudently participate in excellent investments over long periods of time. Notably, despite our gradual position reductions, Nvidia has contributed 1491bps to performance since inception. In turn, these value pathways form the foundation upon which our risk management framework rests, and put us in position to execute our investment program in future periods of duress.”
Like Adobe Inc. (NASDAQ:ADBE), ServiceNow, Inc. (NYSE:NOW), and Advanced Micro Devices, Inc. (NASDAQ:AMD), NVIDIA Corporation (NASDAQ:NVDA) is a rising tech company that has reached the ranks of the big tech group.
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Disclosure: None. 13 Best Big Tech Stocks To Buy Now is originally published on Insider Monkey.