US Tech Sector Overvalued Despite October Slide

Ahead of results from Amazon and Alphabet this week, Morningstar analysts look at valuations in the tech sector

Brian Colello, CPA 22 October, 2018 | 8:45AM
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Apple Nasdaq

Despite recent falls in tech stocks, Morningstar analysts view the overall sector as slightly overvalued, with the Nasdaq still around 15% higher than the same time last year. Last earnings season saw a shakeout in the sector, with Facebook (FB) shares slumping.

So far this tech earnings season, Netflix (NFLX) stock has gained sharply on record subscriber numbers. This week sees including Amazon (AMZN) and Google parent company Alphabet (GOOGL) report earnings, with Facebook (FB) and Apple (AAPL) due the following week.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Alphabet Inc A2,864.74 USD0.32Rating Inc3,444.15 USD-0.08Rating
Apple Inc148.76 USD1.51Rating
Cisco Systems Inc55.74 USD1.00Rating
Facebook Inc A339.99 USD1.39Rating
Microsoft Corp308.23 USD0.31Rating
Netflix Inc639.00 USD0.16Rating Inc292.34 USD0.22Rating

About Author

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