These Are The 5 Best Tech Stocks To Buy And Watch Now

These Are The 5 Best Tech Stocks To Buy And Watch Now

The best tech stocks to buy offer a blend of strong fundamentals and leading price performance. And with the Nasdaq composite back on a confirmed uptrend, more and more growth stocks in the tech sector are showing renewed strength.

The best tech stocks to buy and watch aren’t hard to find, as long as you’re fishing in the right pond. A top stock like Arista Networks (ANET) might not get a lot of attention, but it does have a lot of characteristics seen in past stock market winners before big price moves.

The best tech stocks to buy and watch now include ANET, Taiwan Semiconductor (TSM), CrowdStrike (CRWD), ServiceNow (NOW) and Monday.com (MNDY).

Despite sizeable year-to-date gains for the Nasdaq composite and S&P 500 in 2023, the year was challenging for many of the best stocks to buy and watch, in part due to rising interest rates and an increasingly hawkish Federal Reserve.





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But the interest rate and Federal Reserve narrative has changed dramatically with the Fed now set to start cutting rates this year. As a result, a large number of tech stocks to buy and watch are acting better with the stock market back in a confirmed uptrend. The market has dialed back rate-cut expectations, but Wall Street is still feeling comfortable about a soft landing for the economy.

It was a sensational year for Magnificent Seven stocks like Nvidia (NVDA) and Meta Platforms (META), which closed out the year with gains of 239% and 195%, respectively.

But in a year that saw the S&P 500 rise 24%, the S&P 500 Equal Weight ETF (RSP) only mustered a gain of 12%.

Best Tech Stocks To Buy

The 10-year Treasury yield has come under pressure in recent days after the latest reading on consumer and wholesale inflation during the week of June 10 showed inflation generally going in the right direction.

A rising interest rate environment isn’t good for the best stocks to buy in the tech sector with high multiples. Why? Because it makes for a more challenging operating environment. If the stock market senses any possibility of a slowdown in earnings growth from high P-E names, the selling will hit these stocks first.

At one point, fears of a recession and concerns about contagion in the financial sector after the collapse of SVB Financial and Signature Bank last year made it an extremely challenging environment for many of the best stocks to buy and watch.

But fresh follow-through day for the Nasdaq composite and S&P 500 in early November gave a buy signal and market breadth started to broaden out almost immediately. The Nasdaq jumped 1.6% in higher volume on Nov. 1, confirming a new uptrend. The S&P 500 followed suit on Nov. 2 with a 1.9% rise in higher volume.

Top Traits Of Best Tech Stocks To Buy

The best tech stocks to buy and watch boast strong fundamentals along with leading price performance in their industry group. Many also show favorable fund ownership trends.

The best tech stocks also tend to show resilience in down markets. Use IBD Stock Checkup to quickly identify industry group leaders with the potential to be stock market leaders.


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Screening for the best stocks to buy and watch is as easy as looking at the MarketSurge Growth 250, a daily screen of high-quality stocks. Click on any column header to sort the screen as you wish, either by those closest to their highs, stocks with the highest Composite Rating, or stocks trading up in price with the heaviest volume.

The best stocks to buy and watch aren’t guaranteed to be huge stock market winners. But they do have qualities seen in past stock market winners before big price gains.

Best Tech Stocks To Buy: Arista Networks

Arista Networks continues to be a strong performer in the stock market and is one of the best stocks to buy and watch in the networking space. ANET is a candidate to buy on a pullback after a recent bounce off the 10-week moving average for the week ended June 14.

Shares initially fell sharply on May 23 after Nvidia (NVDA) called out strength in its networking business, a major market for Arista. But ANET held support at its 50-day line and eventually reclaimed the 300 level and a prior entry of 307.74.

ANET gapped up on May 8 after reporting Q1 results. Earnings and revenue came in better than expected and guidance was slightly ahead of views. The company also set a $1.2 billion share buyback. Arista sells network switches that speed up communications in data centers.

Arista management forecast $750 million in AI-related sales for 2025, with much of it coming from Ethernet network switches.

Shares were volatile on Feb. 12 despite another strong earnings report. Adjusted profit of $2.08 a share was well ahead of the Zacks consensus for $1.71 a share. Revenue increased 21% to $1.54 billion, a whisker ahead of the $1.53 billion consensus.

Arista Networks, which counts Meta Platforms (META) and Microsoft (MSFT) as large customers, shows bullish earnings and revenue growth in recent quarters, fueled by strong demand for its cloud networking software and hardware for the fast-growing data center market.

Over the past eight quarters, revenue growth has ranged from 16% to 57%.

Full-year earnings are expected to rise 14% this year and 13% in 2025.

Composite Rating: 98 (on 1-99 scale with 99 tops)

Latest-quarter EPS % change: +39%

Latest-quarter sales % change: +16%

Five-year EPS growth rate: 29%

Annual return on equity: 36%

Up/down volume ratio: 1.1

CrowdStrike

CrowdStrike fell hard with other security stocks on Feb. 21, weighed down by a weak earnings report from industry bellwether Palo Alto Networks (PANW). But it didn’t take long for CrowdStrike to find support at the 10-week line.

CRWD help up well again on May 21 despite the second straight earnings sell-off for PANW. The stock is holding gains well after gapping out of a cup-with-handle base on June 10. The buy point at the time was 358.84. Post-breakout, CRWD is trading tightly near highs, which could usher in an alternate entry.

One of the best tech stocks to buy and watch in the security software group, CrowdStrike on June 4 reported adjusted profit of 93 cents a share, up 63% year over year. Revenue increased 33% to $921 million, with subscription revenue up 34% to $872.2 million.

“CrowdStrike started the fiscal year from a position of momentum and exceptional strength, with net new annual recurring revenue (ARR) of $212 million growing 22% year over year and ending ARR growing 33% year over year to reach $3.65 billion,” said George Kurtz, CrowdStrike’s president, chief executive officer and co-founder. “The Falcon platform’s differentiated architecture creates a wide competitive moat and uniquely enables CrowdStrike to solve the industry’s biggest cybersecurity, IT and data problems.”

For its current year fiscal 2025, annual earnings are expected to surge 30%, with growth slowing a bit in fiscal 2026, up 22%.

Composite Rating: 99

Latest-quarter EPS % change: +63%

Latest-quarter sales % change: +33%

Five-year annualized EPS growth rate: 141%

Annual return on equity: 40%

Up/down volume ratio : 0.8

Monday.com

The enterprise software firm started to come under selling pressure with a lot of other software stocks in May. But MNDY is back near highs and setting up for a possible upside breakout over 249.

Shares soared on May 15 after reporting earnings. Before the report, MNDY was not a picture of technical health with the stock mired below the 50-day line. To its credit, MNDY found support at its 200-day line.

Monday.com is enjoying strong growth with its workflow automation and productivity platform. The latest results were impressive, with Q1 profit up 336% year over year to 61 cents a share. Revenue increased 34% to $216.9 million.

The number of paid customers with more than $100,000 in annual recurring revenue jumped to 911, up 55%.

“Q1 represents another great step forward for monday.com, with strong revenue growth and profitability, as well as record free cash flow, said Eliran Glazer, Monday.com CFO. “These results are supported by recent adjustments made to our pricing model, which thus far have exceeded our initial expectations.”

Composite Rating: 97

Latest-quarter EPS % change: +336%

Latest-quarter sales % change: +34%

Five-year annualized EPS growth rate: n/a

Annual return on equity: 13%

Up/down volume ratio: 1.8

ServiceNow

ServiceNow, another one of the best tech stocks to buy and watch, surged above its 50-day line on May 15, but NOW quickly lost the key support level again. The stock showed weak action again on May 30 with a sharp break of the 200-day moving average. A weak earnings report from group peer Salesforce (CRM) was the catalyst.

While a decisive move above the 50-day line and its recent high 784.33 was a positive development for NOW, it has run up a lot over a short period of time. As the stock approaches its all-time high of 815.32, it wouldn’t be surprising to see NOW pull back in light volume and form a downward-drifting handle. Price action like this could set the stage for an upside breakout.

After four straight quarters of accelerating revenue growth. Q1 revenue slowed slightly when the company reported earnings in late April. But revenue still increased 24% to just over $2.6 billion. Adjusted profit rose 44% to $3.41 a share.

Subscription revenue rose 25% to $2.52 billion.

“ServiceNow is off to a fast start with an outstanding first quarter,” said ServiceNow Chairman and CEO Bill McDermott. “As leaders seek significant productivity improvements, ServiceNow has first mover advantage with years of investment in AI technology and talent. Our GenAI offerings are the fastest selling in the company’s history.”

In the first half of 2023, Now announced a partnership with Nvidia (NVDA) to develop enterprise-grade generative AI capabilities to speed up business processes with more intelligent workflow automation.

More recently, Service Now announced a five-year collaboration with Amazon Web Services (AWS) to offer the ServiceNow platform in the AWS Marketplace. Amazon (AMZN) and NOW will also co-develop and launch AI-powered applications.

Composite Rating: 98

Latest-quarter EPS % change: +44%

Latest-quarter sales % change: +24%

Five-year EPS growth rate: 32%

Annual return on equity: 35%

Up/down volume ratio: 1.4

Taiwan Semi

TSMC is the world’s largest chip foundry with high-profile customers like Apple (AAPL), Nvidia (NVDA), Advanced Micro Devices (AMD) and Broadcom (AVGO). Nvidia alone accounted for 11% of TSMC’s revenue in 2023.

When TSM earnings in April, it returned to bottom-line and top-line growth after four straight quarters of declines.

For the June-ended quarter,  TSMC guided revenue of $19.6 billion to $20.4 billion. The midpoint of the guidance, $20 billion, was above the $19.44 billion consensus.

TSMC recently cleared a double-bottom base with a 148.43 buy point. There was a good shakeout in the base when TSMC took out its prior low of 133.03. It’s past the 5% buy zone now. Watch for a low-volume pullback to the 21-day line near 168 for an alternate entry.

Composite Rating: 95

Latest-quarter EPS % change: +11%

Latest-quarter sales % change: +4%

Five-year annualized EPS growth rate: 28%

Annual return on equity: 26%

Up/down volume ratio: 1.1

Follow Ken Shreve on X/Twitter @IBD_KShreve for more stock market analysis and insight.

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