US Outlook: Tech Stocks Pricey, Retailers Too Cheap

Morningstar equity analysts believe the US tech sector is overvalued, but there are investment opportunities in retail stocks unfairly punished by the market

Brian Colello, CPA 4 January, 2018 | 3:07PM Jaime M. Katz, CFA

Amazon Prime

Morningstar equity analysts believe the US technology sector is now overvalued after stunning gains in recent years. We believe valuations across tech are painting overly optimistic scenarios for new and emerging technologies around artificial intelligence. 

Tech bellwethers Apple (APPL), Facebook (FB) and Intel (INTC) all appear modestly overvalued to us. Google parent company Alphabet (GOOG) appears fairly valued.

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Alphabet Inc A1,510.80 USD-5.51
Alphabet Inc Class C1,516.62 USD-5.46 Inc3,162.78 USD-3.76
Apple Inc111.20 USD-4.63
Carnival Corp12.30 USD-10.61
Coca-Cola Co47.96 USD-3.89
Facebook Inc A267.67 USD-5.51
Intel Corp44.25 USD-3.05
Kellogg Co63.49 USD-2.22
Procter & Gamble Co137.66 USD-3.30
Royal Caribbean Group53.12 USD-7.42
The Kraft Heinz Co29.22 USD-4.76

About Author

Brian Colello, CPA  is a senior stock analyst with Morningstar.

Audience Confirmation

By clicking 'accept' I acknowledge that this website uses cookies and other technologies to tailor my experience and understand how I and other visitors use our site. See 'Cookie Consent' for more detail.

  • Other Morningstar Websites
© Copyright 2020 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Cookies