The global stock market is seeing some intense competition in the tech field, with big names like Amazon, Facebook, Snapchat, Google, Apple, and Alibaba fighting it out for the top spot. For investors, though, it becomes extremely difficult to choose an investment option from this highly lucrative list.
To help you understand how these stocks are performing, we have given below a brief explanation of how the above companies have fared on the stock market in the past 12 months. Using this data, you can now make an informed decision and invest in the stock of your choice.
Why do stock prices change?
To better understand how companies fare on the stock market, it’s extremely important to have a clear perspective about how and why stocks change in valuation.
Stocks are highly volatile and change prices as often as multiple times in a minute. These changes in stock prices take place due to myriad factors, such as:
- Demand and supply
- Country-specific monetary and fiscal policies
- Performance of the stock market
- Political and economic upheaval
- Natural disasters
- Company performance
- Performance of other stocks
The top tech stocks you need to know about
The NASDAQ average portfolio of 44% of millennial investors houses at least one of the following tech stocks. But before we get to these, let us first understand a few terms that you will come across below:
- NASDAQ: The American stock exchange
- Buy rating: The rating given by an investment bank to buy a stock because of its great performance in the market
- P/E ratio: The market price of the stock to be paid for a particular level of earnings. Usually, a high P/E ratio is indicative of greater demand for a stock due to expected growth in stock performance.
Amazon stocks happen to be one of the best-performing stocks on the market today. The global Internet giant is on a roll and has been churning out business at a very high speed. With little to no cash deficiency and an ever-growing portfolio of businesses, Amazon may soon churn out enough profits to validate a high price-to-earnings (P/E) ratio.
Currently, amazon stocks are valued at $1195.83, a huge increase from the $766.77 of 2016. If things pan out as experts forecast, Amazon stock prices may increase to $6000 in the next 10 years. Amazon has a Strong Buy rating of 28 and a P/E ratio of 301.84.
As discussed, Facebook is a favorite with the millennials. More than 14% of millennials currently hold Facebook stocks. The company is one of the very few that has not been affected by the downturn in the Internet market. Spokespeople confirm that Facebook will increase the scale of its global operations and increase spending by 25%, meaning there is a huge scope for investments.
Facebook stocks are currently priced at $183.03, as opposed to $120.41 in 2016. Experts believe that the stocks have the potential to have a price increase by almost 16% in the coming 12 months. Facebook has a strong buy rating of 23 and a P/E ratio of 34.02.
Snapchat continues to worry investors with its dismal performance. Currently, Snapchat stocks are valued at $13.06 USD, in a trough, compared to the $24.48 in 2016. The stocks have been on a rollercoaster ride and are extremely volatile, a fact that may dissuade investors looking for more secure and mature investment options.
But, experts believe that Snapchat may snap out of its slumber in early 2018, as new monetization operations and new software updates are in the pipeline.
Google is still the greatest and best performing tech company on the stock market. Current stock price is at $1072.01, a huge high opposed to the $785.79 of 2016. Experts estimate that Google stocks will continue to rise in value as the years go by.
The company is estimated to increase spending on advertising to $724 billion by 2020, ensuring plenty of opportunities for investors to earn big bucks. Google stocks have a buy rating of 22 and a P/E ratio of 35.71.
Although Apple stocks have performed much better compared to the $111.57 of 2016 (current stock price is $174.09), the company has seen a decrease stock price over the past few days.
Despite this, the tech giant is still one of the most favored stocks for millennials and mature investors. Apple has one of the largest cash balances at $246 billion, making it a very safe bet. Experts forecast a price valuation increase of 18% by mid-2018, making Apple a very lucrative option. Apple stocks have a buy rating of 18 and a P/E ratio of 18.95.
The exploding Chinese economy, coupled with one of the fastest international scaling ever scenes, makes Alibaba stocks one of the best options for investors. The stocks, currently priced at $188.03, have come a long way from the $93.76 in 2016. The company’s plans for diversification and lack of competition in the B2B segment make the company a star performer both on the stock market and on-the-field. Alibaba stocks have a buy rating of 16 and a P/E ratio of 52.81.
P.S: Stock prices and P/E ratio are as on November 28, 2017. Kindly replace with the values as on date of article publication.