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Why KLA-Tencor Gapped Down, & More Growth and Income Thoughts

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As trade concerns continue to loom over the heads of global investors, tech stocks have felt the brunt of the hesitation this week, with volatility stemming from a handful of key headlines.

One major talking point was the Congressional testimony of executives from Twitter (TWTR - Free Report) and Facebook (FB - Free Report) , which reignited conversations about the role of social media in our society and reminded investors that these internet companies may soon face regulatory changes.

Another thing causing volatility in tech stocks this week was the Citi Global Technology Conference. One presenter at the event was KLA-Tencor (KLAC - Free Report) , a popular growth and income play and a major provider of semiconductor manufacturing equipment.

KLA-Tencor’s comments at the conference spooked investors, sending its own stock and shares of other major chip companies sharply lower in morning trading.

But any hesitation about KLAC’s outlook clearly has not made it to analysts yet, as the company has witnessed universally positive earnings estimate revisions within the past two months. KLA-Tencor has even received upward estimate revisions for its fiscal year extending into 2020, so it seems analysts have been bullish about its future.

So that leaves investors in an interesting spot. Is today’s gap-down overblow? Should other chip stocks be worried? Ryan suggests waiting out near-term volatility to better gauge Wall Street’s reaction to the conference and to see where shares of KLAC will head next.

Later in the show, Ryan takes a look at Apple (AAPL - Free Report) , a Zacks Rank #2 (Buy) which recently became the first-ever $1 trillion company.

Apple is a dividend-paying company with an impressive growth story to tell right now, so Ryan breaks down the latest estimates to show exactly to what extent the iPhone maker is expected to improve its top and bottom lines this year.

Ryan also speculates that it has been Apple’s ability to develop a diverse product and services ecosystem—with the iPhone at the center—than has been the catalyst for its recent growth. What does this ecosystem include, and where might it go next? Check out today’s video to hear more!

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