Table of Contents
After an uncharacteristically sluggish performance in 2022, tech stocks have come roaring back to life in 2023. In fact, the Technology Select Sector SPDR ETF (ticker: XLK) has more than doubled the S&P 500’s year-to-date return. For more than a decade, brief periods of tech sector underperformance have consistently been long-term buying opportunities, and that trend seems to be playing out once again so far in 2023.
However, inflation and interest rates remain headwinds for tech earnings in the near-term, making stock selection critical. Here are 10 of the best tech stocks to buy today, according to CFRA analysts:
|Tech Stock||Analyst rating||Implied Upside
(as of Oct. 4 close)
|Apple Inc. (AAPL)||Buy||26.7%|
|Microsoft Corp. (MSFT)||Strong Buy||27.6%|
|Nvidia Corp. (NVDA)||Buy||36.2%|
|Broadcom Inc. (AVGO)||Buy||18.4%|
|Adobe Inc. (ADBE)||Buy||19.6%|
|Cisco Systems Inc. (CSCO)||Buy||12.3%|
|Accenture PLC (ACN)||Strong Buy||10.2%|
|Salesforce Inc. (CRM)||Strong Buy||26.8%|
|Advanced Micro Devices Inc. (AMD)||Buy||39.3%|
|Intuit Inc. (INTU)||Buy||4.4%|
Apple produces the iPhone, iPad, Apple Watch, Mac computers and other personal computing devices. In addition, its Services segment includes its App Store, Apple Music, iCloud and licensing businesses. Analyst Angelo Zino says Apple’s combination of a massive, loyal customer base and an expanding addressable market makes it a valuable long-term investment. Apple’s stock is richly valued at a market cap of $2.7 trillion, but Zino says the valuation is warranted given the company’s impressive free cash flow generation and capital return program. CFRA has a “buy” rating and $220 price target for AAPL stock, which closed at $173.66 on Oct. 4.
Microsoft is the world’s largest software company that is best known for Windows, Office and Azure cloud services. Zino says cloud-based versions of Office, Dynamics and Teams are all gaining traction, and Azure infrastructure cloud services are performing well. Microsoft also has a tremendous opportunity for artificial intelligence-related upside, including Copilot, ChatGPT and other OpenAI services. Revenue from Microsoft’s cloud-based businesses now represents nearly two-thirds of the company’s total revenue. Zino projects revenue growth will accelerate from 11% in fiscal 2024 to 13% in fiscal 2025. CFRA has a “strong buy” rating and $407 price target for MSFT stock, which closed at $318.95 on Oct. 4.
Nvidia designs and sells high-end graphics and video processing chips used for desktop and gaming personal computers, workstations and other advanced computing servers and supercomputers. Not only is Nvidia one of the best-performing stocks in the entire market in the past 15 years, its year-to-date 194.5% gain is the best performance of any stock on this list so far in 2023. Zino says Nvidia has an exceptional growth outlook driven by generative AI demand and projects revenue will rise 36% in fiscal 2025 and 14% in 2026. CFRA has a “buy” rating and $600 price target for NVDA stock, which closed at $440.41 on Oct. 4.
Broadcom is a diversified global analog semiconductor supplier. Zino says Broadcom’s networking, switcher and application-specific integrated circuit (ASIC) businesses will make the company one of the largest winners from an AI infrastructure investment boom. In addition, a recent extension of Broadcom’s chip supply deal with Apple significantly improves financial visibility given Apple represents 20% of Broadcom’s total sales. Zino says the addition of VMware Inc. (VMW) could add $8.5 billion in earnings before interest, taxes, depreciation and amortization, or EBITDA. He projects 7.6% revenue growth in fiscal 2024. CFRA has a “buy” rating and $975 price target for AVGO stock, which closed at $823.81 on Oct. 4.
Adobe produces creative content software and other applications used for marketing and e-commerce. Zino says Adobe holds a dominant position in key content creation app markets and will benefit from AI monetization opportunities in coming years. He says Adobe has cross-selling advantages, and its Firefly generative AI models are attracting attention on Photoshop, Illustrator and other Adobe platforms. Zino says Adobe will continue to integrate and monetize AI technology, which could boost subscription growth as well. He projects 11% revenue growth in fiscal 2024 and 13% growth in 2025. CFRA has a “buy” rating and $620 price target for ADBE stock, which closed at $518.42 on Oct. 4.
Cisco Systems Inc. (CSCO)
Cisco Systems provides networking, cloud and cybersecurity hardware and software solutions. Cisco shares have lagged the tech sector overall in 2023 with just a 10.1% year-to-date gain. However, the stock also pays a 2.9% dividend, the highest yield of any stock on this list. Analyst Keith Snyder says the long-term prospects for Cisco remain bullish as 5G core deployments and the Wi-Fi 6 upgrade cycle serve as demand drivers. Snyder says Cisco will benefit from growth in bandwidth consumption and data center solutions. CFRA has a “buy” rating and $60 price target for CSCO stock, which closed at $53.45 on Oct. 4.
Accenture is a global information technology services firm that specializes in consulting and outsourcing. Snyder says Accenture is a high-quality business that has a diverse network of client relationships, a long-term track record of impressive earnings growth and a solid balance sheet that makes the stock an excellent defensive tech investment in an uncertain macroeconomic environment. He says Accenture is positioned well to address customer priorities, and the company’s business has held up well as falling information technology project budgets have weighed on industry peers. CFRA has a “strong buy” rating and $341 price target for ACN stock, which closed at $309.39 on Oct. 4.
Salesforce is the world’s largest provider of cloud-based customer relationship management (CRM) software. Zino says Salesforce shares trade at an attractive valuation given the company’s potential for ongoing growth and improving profitability. Salesforce has spent several years investing heavily in strategic acquisitions, and Zino says that strategy has helped the company build the most impressive suite of CRM offerings in the market. He says Salesforce will continue to grow its roughly 30% share of the CRM market and projects 9% to 11% revenue growth in coming years. CFRA has a “strong buy” rating and $256 price target for CRM stock, which closed at $201.87 on Oct. 4.
Advanced Micro Devices Inc. (AMD)
Shares of microprocessor and graphics semiconductor stock Advanced Micro Devices are up a whopping 2,350% over the past decade, but Zino says there is more upside potential ahead given the company’s improving balance sheet, exciting graphics processing unit portfolio, growing AI technology opportunities and ongoing rollout of its next-generation EPYC processors. He says AMD’s margins will expand in the second half of 2023 and into 2024, driven by a better mix of high-priced new product launches. Zino projects 21% revenue growth in 2024. CFRA has a “buy” rating and $145 price target for AMD stock, which closed at $104.07 on Oct. 4.
Intuit produces accounting and management, tax preparation and personal finance software. Analyst Garrett Nelson says Intuit has an online ecosystem that has facilitated the transition of desktop customers to cloud-based solutions, particularly retail consumers and small-to-medium-sized businesses. Nelson says the data sets from acquisitions Credit Karma and Mailchimp provide significant value, and Intuit’s strong brand name should open the door to cross-selling and upselling opportunities among customers of its various brands. Nelson projects 12% revenue growth in fiscal 2024 and 14% growth in 2025. CFRA has a “buy” rating and $540 price target for INTU stock, which closed at $517.46 on Sept. 4.