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4 Large-Cap Tech Stocks to Grab Now as December Rate Cut Hopes Brighten
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Key Takeaways
Tech stocks rebound as investors eye a December rate cut and four large-cap picks gain focus.
Softer PPI and retail sales data boost hopes for easing and support renewed interest in NVDA.
PLTR posts rising earnings estimates, highlighting strong growth expectations across the tech group.
Wall Street appears to have rebounded after a tech bloodbath saw all major indexes — the S&P 500, the Nasdaq and the Dow — remain volatile in October and November. However, tech stocks are once again driving the rally, with investors hopeful that the Federal Reserve will cut interest rates in December.
Also, some positive economic data has lifted investor sentiment. Given this scenario, we recommend four large-cap tech stocks from this space, namely, Amazon.com, Inc. (AMZN - Free Report) , NVIDIA Corporation (NVDA - Free Report) , Palantir Technologies Inc. (PLTR - Free Report) and Micron Technology, Inc. (MU - Free Report) , which have strong potential for 2025 and the coming year. Each of the stocks has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Tech Stocks Rebound Before Thanksgiving Day
Stocks closed higher for the fourth straight session ahead of the Thanksgiving holiday, as tech stocks rebounded after suffering for most of November. The Dow and the S&P 500 each ended 0.7% higher on Thursday, while the Nasdaq finished up 0.8%.
The past few weeks saw investors dumping riskier assets, especially tech stocks, as concerns grew over the sky-high valuations of artificial intelligence (AI) stocks. Investors feared that AI is yet another bubble, and it’s a matter of time before it bursts.
However, robust quarterly results from a large number of companies focused on AI and some major deals reached between some big AI players appear to have restored investors' faith in the tech sector.
Positive Economic Data
The 43-day government shutdown that recently ended left investors with no economic data, making it difficult for them to assess the economy’s health. However, some positive economic data released over the past week have raised hopes of a rate cut in December.
The producer price index (PPI) showed that wholesale prices rose less than expected in October. The PPI rose 0.3% sequentially in September. Core PPI, which excludes the volatile food and energy prices, rose 0.1% month over month in September, lower than the consensus estimate of a rise of 0.2%.
Year over year, PPI and core PPI rose 2.7% and 2.6%, respectively, in September. Also, retail sales rose 0.2% sequentially in September. Although it was below the expectations of a rise of 0.4%, it bodes well for the retail sector ahead of the holiday season.
Slowing inflation has now raised hopes of a rate cut in December. Expectations of another rate cut this year had declined substantially during the government shutdown. Markets are now pricing in an 84.9% chance of a 25-basis-point rate cut in December, according to the CME FedWatch Tool. This fell below 46% last week after Fed officials said that lower borrowing costs would pose a challenge for the central bank in its fight against inflation.
4 Tech Stocks With Upside
Amazon.com, Inc.
Amazon.com, Inc. is one of the largest e-commerce providers, with sprawling operations in North America, now spreading across the globe. AMZN’s online retail business revolves around the Prime program, well-supported by the company’s massive distribution network. Further, the Whole Foods Market acquisition helped Amazon establish a footprint in the physical grocery supermarket space. AMZN also enjoys a dominant position in the cloud-computing market, particularly in the Infrastructure as a Service space, thanks to Amazon Web Services.
Amazon.com has an expected earnings growth rate of 29.7% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the last 60 days. AMZN presently carries a Zacks Rank #2.
NVIDIA Corporation
NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms.
NVIDIA has an expected earnings growth rate of 54.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.8% over the last 60 days. NVDA presently has a Zacks Rank #1.
Palantir Technologies Inc.
Palantir Technologies Inc. builds and deploys software platforms for the intelligence community to help in counterterrorism investigations and operations across the United States and internationally. PLTR’s software is used in approximately 80 industries globally.
Palantir Technologies has an expected earnings growth rate of 78.1% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 10.6% over the last 60 days. PLTR presently carries a Zacks Rank #2.
Micron Technology, Inc.
Micron Technology, Inc., through global brands, namely Micron, Crucial and Ballistix, manufactures and markets high-performance memory and storage technologies, including Dynamic Random Access Memory, NAND flash memory, NOR Flash, 3D XPoint memory and other technologies. MU’s solutions are used in leading-edge computing, consumer, networking and mobile products. Micron continues to benefit from the surging demand for high-performance computing components for AI, data centers, and mobile devices.
Micron Technology has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 5.9% over the last 60 days. MU presently sports a Zacks Rank #1.
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4 Large-Cap Tech Stocks to Grab Now as December Rate Cut Hopes Brighten
Key Takeaways
Wall Street appears to have rebounded after a tech bloodbath saw all major indexes — the S&P 500, the Nasdaq and the Dow — remain volatile in October and November. However, tech stocks are once again driving the rally, with investors hopeful that the Federal Reserve will cut interest rates in December.
Also, some positive economic data has lifted investor sentiment. Given this scenario, we recommend four large-cap tech stocks from this space, namely, Amazon.com, Inc. (AMZN - Free Report) , NVIDIA Corporation (NVDA - Free Report) , Palantir Technologies Inc. (PLTR - Free Report) and Micron Technology, Inc. (MU - Free Report) , which have strong potential for 2025 and the coming year. Each of the stocks has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Tech Stocks Rebound Before Thanksgiving Day
Stocks closed higher for the fourth straight session ahead of the Thanksgiving holiday, as tech stocks rebounded after suffering for most of November. The Dow and the S&P 500 each ended 0.7% higher on Thursday, while the Nasdaq finished up 0.8%.
The past few weeks saw investors dumping riskier assets, especially tech stocks, as concerns grew over the sky-high valuations of artificial intelligence (AI) stocks. Investors feared that AI is yet another bubble, and it’s a matter of time before it bursts.
However, robust quarterly results from a large number of companies focused on AI and some major deals reached between some big AI players appear to have restored investors' faith in the tech sector.
Positive Economic Data
The 43-day government shutdown that recently ended left investors with no economic data, making it difficult for them to assess the economy’s health. However, some positive economic data released over the past week have raised hopes of a rate cut in December.
The producer price index (PPI) showed that wholesale prices rose less than expected in October. The PPI rose 0.3% sequentially in September. Core PPI, which excludes the volatile food and energy prices, rose 0.1% month over month in September, lower than the consensus estimate of a rise of 0.2%.
Year over year, PPI and core PPI rose 2.7% and 2.6%, respectively, in September. Also, retail sales rose 0.2% sequentially in September. Although it was below the expectations of a rise of 0.4%, it bodes well for the retail sector ahead of the holiday season.
Slowing inflation has now raised hopes of a rate cut in December. Expectations of another rate cut this year had declined substantially during the government shutdown. Markets are now pricing in an 84.9% chance of a 25-basis-point rate cut in December, according to the CME FedWatch Tool. This fell below 46% last week after Fed officials said that lower borrowing costs would pose a challenge for the central bank in its fight against inflation.
4 Tech Stocks With Upside
Amazon.com, Inc.
Amazon.com, Inc. is one of the largest e-commerce providers, with sprawling operations in North America, now spreading across the globe. AMZN’s online retail business revolves around the Prime program, well-supported by the company’s massive distribution network. Further, the Whole Foods Market acquisition helped Amazon establish a footprint in the physical grocery supermarket space. AMZN also enjoys a dominant position in the cloud-computing market, particularly in the Infrastructure as a Service space, thanks to Amazon Web Services.
Amazon.com has an expected earnings growth rate of 29.7% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the last 60 days. AMZN presently carries a Zacks Rank #2.
NVIDIA Corporation
NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, NVDA’s focus has evolved from PC graphics to AI-based solutions that now support high-performance computing, gaming and virtual reality platforms.
NVIDIA has an expected earnings growth rate of 54.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.8% over the last 60 days. NVDA presently has a Zacks Rank #1.
Palantir Technologies Inc.
Palantir Technologies Inc. builds and deploys software platforms for the intelligence community to help in counterterrorism investigations and operations across the United States and internationally. PLTR’s software is used in approximately 80 industries globally.
Palantir Technologies has an expected earnings growth rate of 78.1% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 10.6% over the last 60 days. PLTR presently carries a Zacks Rank #2.
Micron Technology, Inc.
Micron Technology, Inc., through global brands, namely Micron, Crucial and Ballistix, manufactures and markets high-performance memory and storage technologies, including Dynamic Random Access Memory, NAND flash memory, NOR Flash, 3D XPoint memory and other technologies. MU’s solutions are used in leading-edge computing, consumer, networking and mobile products. Micron continues to benefit from the surging demand for high-performance computing components for AI, data centers, and mobile devices.
Micron Technology has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 5.9% over the last 60 days. MU presently sports a Zacks Rank #1.