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ETF Specialist

Take a Small Bite of a Cheap Apple With This ETF

Apple and many other large-cap tech names are trading at attractive valuations.

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Morningstar's Take
The share prices of some large-cap United States technology companies have been battered in recent months, amid a global macroeconomic malaise, uncertain prospects for some players, and very negative market sentiment toward certain corners of the tech space.

These declines represent a buying opportunity for investors, as the technology sector now has become undervalued in aggregate, according to Morningstar's equity analysts. Our analysts assert that recent sell-offs now mean that several tech titans, such as  Intel (INTC),  Microsoft (MSFT), and  Apple (AAPL), are priced to reflect long-term secular declines in their business. And while the PC market, which Intel and Microsoft serve, may well be struggling and in decline, investors should note that Intel and Microsoft have exposure to many other growing areas of technology. More broadly, for a longer-term investor to be comfortable with currently sagging valuations in the tech space, that investor would need to believe that neither Intel nor Microsoft nor Apple will be able to capitalize on growing global demand for computing devices.

Robert Goldsborough does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

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