Technology stocks continue to be some of the most exciting investments in today’s stock market. Known for their strong growth potential and the ability to deliver impressive returns, the tech sector consistently attracts attention from investors. As we approach the end of 2024, it’s important to evaluate the top-performing stocks in this space, as they may provide clues about the companies likely to drive future growth. While past performance doesn’t guarantee future results, certain tech companies have consistently delivered solid returns, making them key players to follow.
In this article, we’ll explore the best-performing tech stocks of 2024, laggards in the sector, and provide insight into the performance of the Magnificent 7—the biggest names in tech. We’ll also answer a key question: Should you invest in these top-performing stocks, or are there better ways to get involved in the tech sector? Read on to find out.
Best Tech Stocks to Buy in December 2024: Top Performers
As we near the end of the year, several tech stocks have stood out for their impressive growth. Here’s a look at the top tech performers in 2024, based on their year-to-date performance:
- Palantir Technologies (PLTR): +290.7%
- Nvidia (NVDA): +179.3%
- Fair Isaac (FICO): +104.0%
- GoDaddy (GDDY): +86.1%
- Oracle (ORCL): +75.3%
- Arista Networks (ANET): +72.3%
- Dell Technologies (DELL): +66.8%
- Fortinet (FTNT): +62.4%
- Corning (GLW): +59.8%
- Motorola Solutions (MSI): +59.6%
These companies have experienced tremendous growth this year, driven by their innovative products, services, and market dominance. While past performance isn’t always a predictor of future success, these companies have demonstrated solid fundamentals that position them for continued growth in the long term.
Tech Stocks to Watch: The Underperformers of 2024
While it’s important to focus on the winners, keeping an eye on underperforming stocks can also offer valuable insights. Sometimes, these stocks have struggled due to factors such as market corrections, geopolitical tensions, or the need for a period of business adjustment. The underperformers of 2024 could become top performers next year as their fundamentals catch up with market expectations.
Here are the worst-performing tech stocks of 2024:
- Intel (INTC): -52.1%
- Enphase Energy (ENPH): -46.0%
- Qorvo (QRVO): -38.7%
- Microchip Technology (MCHP): -24.4%
- CDW (CDW): -22.6%
These stocks have faced significant setbacks this year. However, investors should keep in mind that stock prices can recover when the company adjusts to market demands or when broader industry trends shift in their favor. For instance, Intel may benefit from future innovations in chip design and manufacturing.
The Magnificent 7: Performance Overview in 2024
The Magnificent 7 refers to the seven largest and most influential tech companies in the world, including Apple, Microsoft, Amazon, Alphabet, Tesla, Nvidia, and Meta Platforms. These companies dominate the tech space, and their performance often sets the tone for the entire sector. Here’s how the Magnificent 7 have performed in 2024:
- Apple (AAPL): +23.3%
- Microsoft (MSFT): +12.6%
- Amazon (AMZN): +36.9%
- Alphabet (GOOGL): +21.0%
- Tesla (TSLA): +38.9%
- Nvidia (NVDA): +179.3%
- Meta Platforms (META): +62.3%
These stocks represent the giants of the tech industry and have collectively driven a significant portion of the market’s performance. Nvidia and Meta Platforms stand out with their exceptional growth, while Amazon and Tesla have shown strong returns as well.
Should You Invest in the Top Tech Stocks?
Investing in individual tech stocks can be both exciting and risky. While some investors have made significant profits by holding stocks in companies like Nvidia or Amazon, others have faced losses when stocks underperform. The key to successful investing in tech stocks is understanding the business model, growth potential, and industry trends.
For those who aren’t ready to research individual stocks, there are alternatives. Index funds or exchange-traded funds (ETFs) focused on the tech sector can provide exposure to a wide range of companies without the need for stock picking. These funds track a collection of stocks within the technology industry, offering diversification while still allowing investors to tap into the potential growth of the sector.
Passive investing in tech-focused funds is often a more stable approach for those who want to take advantage of the rising tech sector without the complexities of individual stock selection.
Navigating the Tech Sector in 2024 and Beyond
Tracking the best-performing tech stocks can help investors identify which companies are thriving, but investing in these stocks requires careful research and understanding of the business. Whether you choose to buy individual stocks or invest in a tech-focused fund, it’s important to assess the growth potential, risks, and your own investment strategy.
As Warren Buffett famously said, “The stock market is a no-called-strike game. You don’t have to swing at everything — you can wait for your pitch.” Patience, research, and a long-term perspective can help investors navigate the dynamic tech sector and make informed decisions that could lead to solid returns.
Reference : James Royal, Ph.D.