As technology is ever growing and making deep roots everywhere; investing in technology is a trendy and easy way to give wings to your business. Companies that make laptops, mobile phones, and smart apps are the top ones in this category. Thus, finding the best tech stocks to invest in can make your business successfully strive in the competitive market.
But the question is which tech stocks to buy for optimum growth. Don’t worry, we are here to provide you with some of the top options and a guide on selecting the best stocks for investment. In this article, we have enlisted five top-of-the-line technology stocks that aid in giving a boost and rapid scalability to your business.
These stocks are not only new in technology but are ideal ways to find the already popular tech stocks that are anticipated to increase their worth in the future. The simple rule to finding the best tech stocks is to follow the businesses that are focusing on future trends.
Yet, before moving to the best technology stocks, it is advised to learn some basics and important aspects of investing in technology from numerous online tech blogs, such as TechyWired and similar sites.
Categories of Tech Stocks
Technology is a vast field and involves a huge number of divisions and sub-division. To make it easier, we can divide the tech stocks into two categories: software-related tech stocks and hardware-related tech stocks.
The businesses or companies that develop or sell digital services like software, and applications are the software-related tech stocks source. Software companies develop software that runs on hardware products, for instance, cybersecurity software, operating software, etc.
On the other hand, the companies that develop physical technology products ranging from small devices like microchips to large ones like laptops are hardware tech stocks. The other popular devices are smart products like smartwatches, smartphones, speakers, personal computers, etc. There are some other tech companies as well which work on software and hardware, together.
Why Invest in Technology Stocks?
Investing in technology is a hot topic that is gripping the attention of businessmen worldwide. But why invest in technology? Some people think that selecting a brand name can help in getting height. Unfortunately, it is not the right criteria. The stocks that are focusing on the future with a high turnover are a good option to start with. The following are reasons for which a company should invest in technology stocks:
Rapid Growth and Scalability
Investing in technology stocks is a great opportunity to open doors to business growth and success. Tech stocks provide a good turnover. In history, it has been reported by businessmen that certain tech stocks have generated triple-digit returns, which is quite a good figure. These high returns provide instant scalability to the business. Further, if you are interested in diversification, then tech stocks are an amazing choice for you.
High Returns
High returns are directly associated with business growth. Investors who invest in rapidly growing tech stocks get high returns promoting the business profit ratio.
Continuous Innovations
The best stocks are the ones that innovate frequently and tech stocks are tremendous in this regard. These innovate to be in trend and progress continuously. Technology stocks transform the way of life and business with advanced innovations. The tech stocks produce the innovations that people are utilizing daily like smartphones, laptops, and watches depicting a high consumption rate for a safe investment plan.
Risks Associated with Technology Stocks Investment
Although investing in tech stocks has many charming benefits, still it possesses a few potential risks. The investors must keep in mind these risks for a better investment plan and outcome:
- Investing in tech stocks is an effective way of boosting the business but always consider the best time to invest. Investing after the peak time has gone can lead to drastic failure.
- Technology has always been associated with security risks, so cybersecurity is another important concern.
- Working or dealing with tech stocks needs compliance with the regulatory aspect, so the breaches can be very problematic for your business’s growth and reputation.
- As the competition in the technology market is quite high, following the trends is a common habit for innovation and progress. But a company that adopts a low-key trend can lose the path to success leading to failure for your investment, therefore understanding and selecting tech stocks to invest in is challenging.
List of Best Tech Stocks to Buy in 2023
We are living in the era of digitalization, still, there are people who find investing in technology a risky plan. investing in tech stocks can be very helpful in lifting the business revenue and spectrum if you have chosen the right tech stock.
Investing in a technology stock that does not have an impressive revenue or profit ratio is not a suitable option. Always go for the tech stock that follows technological and trendy aspects with high revenue and capitalization.
Selecting a tech stock for investment is critical, but do not worry. As we have mapped out the profile for the top 5 best technology stocks to buy now so you can take decisions effortlessly.
Apple
- Market Capital: $2.5 trillion
- 5 Year Average Annualized Return: 5%
- Earnings Per Share (EPS): $1.52
Apple is a brand name that has made a prominent mark in bringing innovations in technology. It is one of the top largest companies in the World. It has developed many of the amazing products that we wear and use now like smartwatches, smartphones, etc. Thus, if you want to invest in technology stocks, Apple is a splendid option that can provide you with a high success rate, profit, scalability, and returns.
It belongs to that small group of businesses that has a market capitalization of trillions. It also reflects a remarkable tech stock in regard to cash flow. The business that is involved in technology and innovation is a power pack combination to invest with high success chances.
Amazon
- Market Capital: $36 trillion
- 5 Year Average Annualized Return: 23%
- Earnings Per Share (EPS): $0.22
Every one of us has ever heard of the name Amazon. It is one of the ideal options for e-commerce investors. It is a giant e-commerce-based business that can prove to be a safe option for technology stocks. In times of COVID-19, when everyone was struggling to save their business and earnings, Amazon got a boost in business. It is one of the top ten most popular stock profiles in the ETF.
The Amazon company had faced some droppings in shares and business, but it evolved again with a new strategy. It has expanded to cloud computing and a few other trendy modifications in the model. These smart moves have made it a huge surviving company with a boosted profit ratio.
Amazon web services are Amazon’s cloud computing product that is making significant progress in the global digital infrastructure. The growth rate of Amazon web services in the first quarter is 37 % which is quite notable.
Microsoft Corporation
- Market Capital: $1.9 trillion
- 5 Year Average Annualized Return: 5%
- Earnings Per Share (EPS): $2.22
Bill Gates and Paul Allen are the founders of Microsoft. They developed it as a personal computer company in 1975. But with growing time, they found that this could not flourish to heights with limiting to one category. then they expanded it to software.
Word, PowerPoint, and Excel are a few of the most common products of Microsoft. It has shifted to the Software-as-a-Service model which has turned the tables. The strategic change in the model helped in reducing the cost and leading to cash flow.
Alphabet Inc.
- Market Capital: $1.4 trillion
- 5 Year Average Annualized Return: 8%
- Earnings Per Share (EPS): $24.62
Alphabet Inc. is a powerful and leading company that nurtures other dominant brands like Google, Android, YouTube, etc. Alphabet Inc. is different from the other businesses in the way that it dominantly supports multiple areas, rather than sticking to only one aspect.
Netflix
- Market Capital: $77.69 billion
- 5 Year Average Annualized Return:8 %
- Earnings Per Share (EPS): $3.53
Netflix has revolutionized the pattern of watching TV. Now, people are switching to watching entertainment on Netflix. It provides a huge range of TV series, web series, movies, shows, etc for its audience in HD.
There are some business persons who love to take risks and challenges. If you are among them, then here is the tech stock for you. It is one of the largest companies with high customer traffic, but there is poor stability in the customer traffic making it a risky option to invest in.
Final Words
Due to the pandemic, many of the stocks have declined to a limit which makes it difficult for investors to invest. But now, the companies have progressed with their strategic planning and technological solutions so investing in technology stocks is still a great option. Amazon and Apple are the top trendy options suitable to invest in for business growth and progress in recent times. These have proved to be the safe option for investors and making remarkable improvements in their businesses.
