The global tech space has been ravaged in the last one month. Back-to-back threats emanating from Facebook’s (FB - Free Report) data breaches and consequent concerns over stringent regulations over the social media space, a massacre with Nvidia’s self-driving car tests and an acute selloff in Netflix on overvaluation thrashed the space in March.
Then, U.S. President Donald Trump announced that he would levy new tariffs worth up to $60 billion on China, targeting mainly that country’s telecom and technology sector. If these weren’t enough, the U.S. Commerce Department’s Bureau of Industry and Security barred American companies from selling to ZTE for seven years as the Chinese company had allegedly “broken a settlement agreement with repeated false statements” and has been involved in exporting telecom equipment to Iran and North Korea.
Then, Taiwan Semiconductor Manufacturing Co Ltd (TSM - Free Report) dealt a blow to the tech industry on Apr 19 after the company reported Q1 results before market open and pointed at a decline in smartphone demand.
The company’s revenue forecast target for the second quarter came in the range of $7.8 billion to $7.9 billion, falling shy of the analysts’ expectation of $8.8 billion. International Monetary Fund (IMF) too said that the smartphone-driven tech cycle probably topped in late 2015.
The saturation in demand in developed markets and lengthening of upgrade cycles are weighing on the overall smartphone sales. Year over year, Apple logged a decline (5%) in iPhone sales in the fourth quarter of 2017 and Samsung saw a unit decline of 3.6%.
Since TSMC is big supplier of Apple AAPL, order cuts from the current Apple iPhone X processor took a hit to the iPhone maker too. All these have led Technology Select Sector SPDR Fund (XLK - Free Report) to lose more than 3.7% in the last one month (as of Apr 20, 2018). Global X Social Media ETF (SOCL - Free Report) skidded about 5.4% in the last 30 days and VanEck Vectors Semiconductor ETF (SMH - Free Report) has been down more than 2% during this time frame.
Are There Any Survivors?
Against this backdrop, we would like to highlight that there are a few technology stocks that have a Zacks Rank #1 (Strong Buy), belongs to a top-ranked industry and generated at least 10% returns in the last one month.
TheStreet Inc. (TST - Free Report) – Up 17.72% in the last four weeks
It is a leading web-based provider of financial news, commentary and information aimed at helping readers make informed investment decisions. The company hails from a top-ranked Zacks industry (top 35%).
Science Applications International Corporation (SAIC - Free Report) – Up 12.67%
The company is in transaction, technical, engineering and enterprise IT services business. The company provides services in two segments: government and commercial. The company belongs to from a top-ranked Zacks industry (top 15%).
ManTech International Corporation (MANT - Free Report) – Up 11.52%
It is a leading provider of technologies and solutions for mission-critical national security programs for the Intelligence Community; the Departments of Defense, State, Homeland Security, and Justice; and other U.S. federal government customers. The company hails from a top-ranked Zacks industry (top 44%).
Vmware Inc. (VMW - Free Report) – Up 11.42%
The company offers virtualization solutions from the desktop to the data center and comes from a top-ranked Zacks industry (top 23%).
NetApp Inc. (NTAP - Free Report) – Up 10.46%
The company is the data authority for hybrid cloud. The company comes from a top-ranked Zacks industry (top 9%). You can see the complete list of today’s Zacks #1 Rank stocks here.
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