Blue-Chip Tech Stocks for 2019
Even in a brutal 2018, when stocks had a meltdown from the beginning of October to December 24, the tech sector still outperformed other sectors. The top blue-chip tech stocks sold off less and rebounded more quickly than other stocks.
Since the worst Christmas Eve decline ever, blue-chip tech stocks have been on a tear, and so has the tech-heavy Nasdaq. In fact, January 2019 was the best start of a year for stocks since 1987. Tech stocks, in particular, have been an early beneficiary of Wall Street optimism.
Following January’s broad-based rebound, tech stocks continue to be the sector to beat. Since the markets bottomed on December 24, 2018, all of the major stock market indices have recorded solid, double-digit gains.
The Dow Jones Industrial Average (DJIA) has advanced 16.5%, the S&P 500 by 16.6%, and the New York Stock Exchange (NYSE) by 16%. But the tech-heavy Nasdaq has jumped by almost 20%.
Think you know the names of the biggest blue-chip tech stocks on Wall Street? Guess again. A shakeup on the S&P 500 and the creation of a new sector has reconfigured what the top 10 blue-chip tech stocks for 2019 are.
S&P 500 Creates New Sector
All of the major stock market indices are reporting strong gains, but a recent change in how stocks are categorized on Wall Street has resulted in a major shakeup. In September 2018, the S&P 500 created a new sector: “Communication Services.”
This new sector in the S&P 500 replaces the “Telecommunication Services” sector. Not only is it a new sector, but it added a number of very well-known tech stocks from the “Information Technology” and “Consumer Discretionary” sectors. (Source: “The Global Industry Classification Standard (GICS),” MSCI, last accessed February 6, 2019.)
Technology is still the largest sector in the S&P 500, accounting for about 20% of the index.
However, a number of big tech names, like Facebook, Inc. (NASDAQ:FB), Alphabet Inc (NASDAQ:GOOG), and Netflix, Inc. (NASDAQ:NFLX) have been reclassified as “Communication Services” in the S&P 500.
Amazon.com, Inc. (NASDAQ:AMZN), meanwhile, has been moved to the “Consumer Discretionary” sector.
This reshuffling has affected sector funds like the Technology Select Sector SPDR Fund (NYSEARCA:XLK). It has also resulted in the unveiling of new holdings in exchange-traded funds (ETFs) like the Vanguard Telecommunication Services ETF (NYSEARCA:VOX) and iShares S&P Global Consumer Discretionary Sector (NYSEARCA:RXI).
The switch-up has significantly changed the makeup of certain holdings, which investors need to keep an eye on.
For example, the largest holding in the RXI ETF is now Amazon, with a weight of 17.8%. The second-largest holding in the ETF is Home Depot Inc (NYSE:HD)—at 5.5%. (Source: “iShares Global Consumer Discretionary ETF,” iShares, last accessed February 6, 2019.)
In the VOX ETF, Alphabet and Facebook are now the two largest holdings, followed by Verizon Communications Inc. (NYSE:VZ) and Netflix. (Source: “Vanguard Communication Services ETF (VOX),” The Vanguard Group, Inc., last accessed February 6, 2019.)
Top Blue-Chip Stocks in Tech Sector
With the reshuffling and other changes, here’s a list of the biggest and best blue-chip tech stocks to watch in 2019.
Blue-Chip Tech Stocks List
Cisco Systems, Inc.
Microsoft Corporation Stock (MSFT)
A leader of the blue-chip tech stock sector is Microsoft Corporation (NASDAQ:MSFT). The Richmond, Washington-based company develops, licenses, and sells software, devices, and services.
Its most recognizable brands include “Windows,” “Office,” “Skype,” “Outlook,” “LinkedIn,” and “Xbox.”
|Market Cap||$822.6 billion|
|52-Week Stock Price Change||+18%|
|Forward PriceEarnings Ratio||21.32|
|Price/Earnings to Growth Ratio||1.67|
|Total Cash||$127.7 billion|
|Total Debt||$85.5 billion|
(Source: “Microsoft Corporation (MSFT),” Yahoo! Finance, last accessed February 6, 2019.)
Apple Inc. Stock (AAPL)
The ubiquitous Apple Inc. (NASDAQ:AAPL) designs, manufactures, and markets mobile communications and media devices, personal computers, and portable music players.
The company’s most popular products and services include the “iPhone,” “iPad,” “Mac,” “iPod,” “Apple Watch,” “Apple TV,” “iOS,” “iCloud,” and “Apple Pay.”
|Market Cap||$823.8 billion|
|52-Week Stock Price Change||+7.3%|
|Forward PriceEarnings Ratio||13.07|
|Price/Earnings to Growth Ratio||1.02|
|Total Cash||$86.4 billion|
|Total Debt||$114.7 billion|
(Source: “Apple Inc. (AAPL),” Yahoo! Finance, last accessed February 6, 2019.)
Visa Inc Stock (V)
Visa Inc (NYSE:V) helps people buy things they may or may not need. The San Francisco-based payment company connects consumers, merchants, financial institutions, government entities, and others in more than 200 countries through its electronic payment systems.
Visa’s core products include debit, credit, prepaid, and commercial.
|Market Cap||$313.2 billion|
|52-Week Stock Price Change||+18.3%|
|Forward PriceEarnings Ratio||22.99|
|Price/Earnings to Growth Ratio||1.64|
|Total Cash||$11.8 billion|
|Total Liabilities||$16.6 billion|
(Source: “Visa Inc. (V),” Yahoo! Finance, last accessed February 6, 2019.)
Intel Corporation Stock (INTC)
A leader in the global semiconductor industry, Intel Corporation (NASDAQ:INTC) provides computing, networking, data storage, and communications solutions around the world.
The company’s segments are “Client Computing,” “Data Center,” “Internet of Things,” “Non-Volatile Memory Solutions,” “Intel Security,” “Programmable Solutions,” and “All Other and New Technology.”
|Market Cap||$224.9 billion|
|52-Week Stock Price Change||+8.9%|
|Forward PriceEarnings Ratio||10.57|
|Price/Earnings to Growth Ratio||1.02|
|Total Cash||$11.7 billion|
|Total Debt||$26.4 billion|
(Source: “Intel Corporation (INTC),” Yahoo! Finance, last accessed February 6, 2019.)
Cisco Systems, Inc. Stock (CSCO)
Cisco Systems, Inc. (NASDAQ:CSCO) designs, manufactures, and sells Internet Protocol (IP)-based networking products to the global communications and information technology (IT) industry.
The company’s products and services include infrastructure platforms, applications, cybersecurity, cloud calling, and artificial intelligence (AI).
|Cisco Systems, Inc.||Financials|
|Market Cap||$212.5 billion|
|52-Week Stock Price Change||+17.4%|
|Forward PriceEarnings Ratio||14.28|
|Price/Earnings to Growth Ratio||1.68|
|Total Cash||$42.6 billion|
|Total Debt||$25.7 billion|
(Source: “Cisco Systems, Inc. (CSCO),” Yahoo! Finance, last accessed February 6, 2019.)
Mastercard Inc Stock (MA)
Mastercard Inc (NYSE:MA) helps people shop in more than 210 countries and territories. A leader in the global payments industry, Mastercard connects consumers, merchants, financial institutions, and governments around the world.
Customers can make payments using the Purchase, New York-based company’s numerous brands, including “MasterCard,” “Maestro,” and “Cirrus.”
|Market Cap||$222.5 billion|
|52-Week Stock Price Change||+27.4%|
|Forward PriceEarnings Ratio||28.67|
|Price/Earnings to Growth Ratio||1.40|
|Total Cash||$8.4 billion|
|Total Debt||$6.3 billion|
(Source: “Mastercard Incorporated (MA),” Yahoo! Finance, last accessed February 6, 2019.)
Oracle Corporation Stock (ORCL)
The No. 1 provider of business software, Oracle Corporation (NYSE:ORCL) develops, manufactures, sells, hosts, and supports IT solutions for 430,000 customers in 175 countries.
The company is known for its “Oracle Database” for storage, retrieval, and manipulation of data and its “Oracle Fusion Middleware” software to build, deploy, secure, and integrate business applications.
Oracle also provides a range of development tools and business analytics software solutions for mobile computing, the “Java” software development language, and big data solutions.
|Market Cap||$183.9 billion|
|52-Week Stock Price Change||+4.4%|
|Forward PriceEarnings Ratio||14.00|
|Price/Earnings to Growth Ratio||1.46|
|Total Cash||$49.4 billion|
|Total Debt||$58.3 billion|
(Source: “Oracle Corporation (ORCL),” Yahoo! Finance, last accessed February 6, 2019.)
IBM Stock (IBM)
IBM (NYSE:IBM) is a technology company that operates through five segments: “Cognitive Solutions,” “Global Business Services,” “Technology Services & Cloud Platforms,” “Systems,” and “Global Financing.”
The Cognitive Solutions segment is home to “Watson,” the Jeopardy-winning supercomputer. Since its surprise win in 2011, Watson has been used to help diagnose and treat terminal illnesses, defend against cybercrime, cook dinner, encourage consumers to spend more, and drive autonomous cars. (Source: “5 Amazing Things IBM’s Watson Can Do,” D/SRUPTION, April 5, 2017.)
|Market Cap||$123.2 billion|
|52-Week Stock Price Change||-12.1%|
|Forward PriceEarnings Ratio||9.59|
|Price/Earnings to Growth Ratio||10.03|
|Total Cash||$12.0 billion|
|Total Debt||$45.8 billion|
(Source: “International Business Machines Corporation (IBM),” Yahoo! Finance, last accessed February 6, 2019.)
Adobe Inc Stock (ADBE)
Adobe Inc (NASDAQ:ADBE) is a global software company that offers a diverse range of products and services for developing, creating, managing, and optimizing content across various operating systems and devices.
Its flagship products include “Adobe Document Cloud,” “Adobe Creative Cloud,” and “Adobe Experience Cloud.” (Source: “Adobe Fast Facts,” Adobe Inc, last accessed February 6, 2019.)
|Market Cap||$124.3 billion|
|52-Week Stock Price Change||+32.4%|
|Forward PriceEarnings Ratio||26.46|
|Price/Earnings to Growth Ratio||1.39|
|Total Cash||$3.2 billion|
|Total Debt||$4.1 billion|
(Source: “Adobe Inc. (ADBE),” Yahoo! Finance, last accessed February 6, 2019.)
salesforce.com, inc. Stock (CRM)
salesforce.com, inc. (NYSE:CRM) is the world’s No. 1 customer relationship management (CRM) platform.
The San Francisco-based company focuses on cloud, mobile, social media, the Internet of Things (IoT), and AI technologies. Over 150,000 companies use the salesforce CRM to grow their business and strengthen customer relationships. (Source: “What is Salesforce?,” salesforce.com, inc., last accessed February 6, 2019.)
|Market Cap||$121.6 billion|
|52-Week Stock Price Change||+43.3%|
|Forward PriceEarnings Ratio||57.61|
|Price/Earnings to Growth Ratio||1.78|
|Total Cash||$3.5 billion|
|Total Debt||$4.4 billion|
(Source: “salesforce.com, inc. (CRM),” Yahoo! Finance, last accessed February 6, 2019.)
If you’re looking for stability and growth, blue-chip tech stocks have, for the most part, been one of the best places to park your money.
Despite ongoing volatility in the broader stock market, concerns about a slowing economy, rising interest rates, a potential recession in the eurozone, and uncertainty around Brexit, the world’s best blue-chip tech stocks continue to reward buy-and-hold investors.
Check out the original article here.
Author: John Whitefoot, BA