The Influence of Price on Technology Investments for Investors

Navigating Technology Investments: Balancing Market Opportunities with Valuations

Investing in technology can be a challenging task at the moment, as many companies in the sector are currently valued at high levels. Despite this, wealth managers and investors are looking for ways to seize opportunities while keeping valuations in mind. Dan Smith, a senior equity analyst at Canaccord Genuity Wealth Management, acknowledges that investing in technology requires careful consideration of current market conditions.

Timing is crucial when it comes to entering or exiting the market to maximize returns. Storm Uru, co-manager of the Liontrust Global Technology fund, emphasizes the significant opportunities available to investors in the technology sector. However, he is cautious about excessive valuations and maintains a target price for the stocks he owns. If a stock exceeds the target price, he would consider selling it. Uru believes that focusing on companies that benefit from artificial intelligence (AI), rather than AI companies themselves, can offer more attractive valuations.

Smith also prefers to look at companies that facilitate AI rather than AI companies directly. He sees more attractive valuations in this area as these companies are better positioned to benefit from technological advancements without being overvalued themselves. Uru shares a similar sentiment and finds companies that benefit from AI to be an increasingly interesting area for investment. By focusing on these types of companies, investors can access the benefits of technological advancements while also considering valuation factors.

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