While investors are worried about the banking and financial sectors and the growing odds of a recession, they remain enamored with the technology sector. Companies like MSFT, NVDA, and META have recently led the way with positive returns in down markets. As we show with four of the five stocks, smaller, lesser-known technology companies are also having a great year.
Year to date, technology (XLK) is up over 16%, while the S&P and Financials (XLF) are up 3.34% and down 8.86%, respectively.
This scan is purely based on technical studies. We are looking for technology companies that did well in the last few weeks and have consistently outperformed the broader markets over the previous few years.
Our relative sector analysis on SimpleVisor is a great tool for figuring out which sectors are hot in the short term. The table below shows the Technology sector is grossly outperforming, while Real Estate and Financials lag.
The following table below from SimpleVisor shows the five stocks we selected for this scan have positive performance over every time frame out to three years.
Screening Criteria
We considered the following factors when screening:
- Technology Sector
- Price > 200 SMA
- MACD Line is above zero and its baseline.
- RSI > 70
- Positive Performance month to date
Company Summaries
Altair Engineering Inc. (ALTR)
Arista Networks, Inc. (ANET)
Cadence Design Systems, Inc. (CDNS)
Microsoft Corporation (MSFT)
Insight Enterprises, Inc. (NSIT)
Five for Friday
Five for Friday uses stock screens to produce five stocks that we expect will outperform if a particular investment theme plays out in the future. Investment themes may be relevant to the current or expected market, industry and/or economic trends. Investment themes may not always represent our current forecast.
Disclosure
This report is not a recommendation to buy or sell the named securities. We intend to elicit ideas about stocks meeting specific criteria and investment themes. Please read our disclosures carefully and do your own research before investing.
Michael Lebowitz, CFA is an Investment Analyst and Portfolio Manager for RIA Advisors. specializing in macroeconomic research, valuations, asset allocation, and risk management. RIA Contributing Editor and Research Director. CFA is an Investment Analyst and Portfolio Manager; Co-founder of 720 Global Research.
Follow Michael on Twitter or go to 720global.com for more research and analysis.
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