Bank of America Securities called the beaten-down technology and communications stocks potential winners. Investors with a long-term time horizon may consider stocks that are down by over 20% from their 52-week highs.
Micron Technology (MU), a memory supplier, fell by over 40%. Though demand for memory surged as customers bought AI servers, that momentum is far from assured. Chatbots may yield no operational efficiency nor drive sales.
CrowdStrike (CRWD) lost 40% after the sell-off in technology. It caused a global outage, damaging its reputation. The firm is supposed to prevent cyberattacks that lead to a systems outage.
First Solar (FSLR) peaked at over $300 and then broke down below its 50-day simple moving average. SunPower (SPWR) filed for bankruptcy while SolarEdge (SEDG) closed near a 52-week low. Investors should avoid the solar energy sector.
Nvidia (NVDA) lost one-quarter of its value. The firm’s upcoming quarterly report should end the sell-off. It is one of the few firms prospering from a spike in sales in the “AI gold rush.” Still, Super Micro Computer (SMCI) posted strong results and hiked its outlook. The stock sold off after the earnings report.
Selling pressure is higher for AMD, Applied Materials (AMAT), and Western Digital (WDC). They are more sensitive to a slowdown in AI-related hardware sales.
