- The strong pullback pushed the shares of Meta to attractive levels.
- Apple stock could get more support after the recent increase of the share repurchase program.
- If the general market begins to rebound from current levels, mega cap tech stocks will likely lead the way.
The tech-heavy Nasdaq is down by more than 20% from the highs that were reached back in November 2021, and leading tech stocks are trading at a significant discount to the levels that were seen in the second half of the previous year. The recent pullback pushed many stocks to more attractive levels, so traders have a chance to purchase leading tech stocks at a discount.
Meta Platforms touched highs near the $380 level back in August 2021 but lost momentum and pulled back towards the $170 level.
The recent earnings report provided the much-need support to Meta shares. The company beat analyst estimates and also reported growth in daily active users.
Currently, analysts expect that Meta will report earnings of $12.06 per share in 2022 and earnings of $14.25 per share in 2023, so the stock is trading at less than 15 forward P/E.
Analyst estimates have been moving lower in recent months and current valuation levels reflect this trend. However, this valuation makes Meta stock better prepared for the upcoming rate hikes from the Fed, so the stock will likely attract speculative traders who are willing to bet that the huge pullback was not justified.
Apple is trading at 24 forward P/E, which is not too cheap, but traders have been willing to pay a premium for Apple stock for years. Importantly, this premium stays withing reasonable levels, supporting constant demand for Apple stock.
The company has recently released its earnings report, beating analyst estimates on both earnings and revenue.
The company increased its quarterly dividend from $0.22 per share to $0.23 per share and also increased its share repurchase program by $90 billion.This buyback program should provide additional support to the stock.
For a look at all of today’s economic events, check out our economic calendar.
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