Harry Domash's Winning Investing

After Coronavirus, Tech Will Lead the Way

At this point, nobody knows when the coronavirus will no longer be a threat and the market recovers. But when that happens, technology will lead the way. Why?

Look at how much the virus crisis has changed the pattern of our lives. We’re working from home, ordering more stuff online, watching more movies and even socializing online. Those activities require products and services provided by tech sector firms.

Many of these habits that I just mentioned will probably stick with us, at least to some degree, when life goes back to normal.

If so, for investors, the tech sector will be the place to be. If you agree, here are six stocks and one Exchange Traded Fund (ETF) worth considering. 

Seven Tech Plays

Amazon.com (AMZN): When it comes to shopping, online has been steadily grabbing share from brick and mortar stores for some time, and recent events have only accelerated that trend. But there’s more to this story. Where most large corporations once operated their own on-site data centers, most are now shifting to remote data centers, commonly referred to as “the cloud.” Guess who is the largest provider of cloud services? None other than Amazon Web Services (AWS), a highly profitable operation that generates the cash flow that funds Amazon’s retail operations.

Microsoft (MSFT): Microsoft has dominated the PC software market as long as most of us can remember, but now most of its growth is coming from its relatively new cloud data center services business, which now accounts for around 50% of revenues.  

Alphabet (GOOGL): Operating under the Google brand, Alphabet dominates the internet search business and that operation, combined with YouTube, makes it the world’s largest generator of internet advertising revenue.

Facebook (FB): Between its Facebook, Instagram, and WhatsApp applications, Facebook with over 2.7 billion users, dominates the internet social networking space.  Because it collects considerable user data, Facebook offers advertisers a better ability to target their ads than  other media.

Qualcomm (QCOM): A major producer of semiconductor chips used in communications and storage applications, Qualcomm is expected to be a major player in the rollout of 5G (higher speed) products. Pays dividends equating to a 3.4% yield.

KLA Corp. (KLAC): No matter who sells the most chips, someone has to develop and supply the process control and yield management systems needed to produce them. KLA with a 50%+ market share, dominates that market. Dividend yield 2.3%.

First Trust NASDAQ Technology Dividend ETF (TDIV): If you’d prefer to avoid single-stock risk, this ETF tracks the performance of most of the big players that pay dividends  including Microsoft, Intel, Apple, Cisco Systems, Qualcomm and Broadcom. Pays dividends equating to a 2.8% yield. 

These are my ideas. But do your own research before you buy. The more you know about your stocks, the better your results.  

4/13/20

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