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Oracle (ORCL) shares fell nearly 40% in less than three months after its post-earnings surge.
Oracle trades at 30.8 times forward P/E after its decline.
Meta Platforms (META) is down close to 25% as investors question its elevated AI spending levels.
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Though the S&P 500 is still far off from a 10% correction, now down just over 4% from its all-time high, the amplified pain in tech has been notable, with the Nasdaq 100 still down over 7% from its October peak. As the down days hit the Nasdaq 100 harder than the S&P (that’s typical), while also rising less in the recovery days (believe it or not, the Nasdaq 100 actually gained less than the S&P on Friday’s bounce-back day, driven by Fed comments), this latest AI valuation scare might not be over with quite yet.
But that doesn’t mean you should pass up on a chance to make a big swing on the bigger opportunities that fly through your strike zone. In this piece, we’ll look at three great large-cap tech stocks that have already fallen far more than the rest of the market and the Nasdaq 100 and might be spared if they have already “ripped the band-aid off,” so to speak.
Of course, there’s always the possibility that amplified pain begets even more pain. But, for the most part, I view the excess selling as overdone and perhaps opening up a window to buy names at 25-40% off their highs, even for those who think the market pullback has yet to conclude.
If you bought up shares of Oracle (NYSE:ORCL) after that unprecedented post-earnings pop, you took a shot right on the chin, with shares now down close to 40% in less than three months. That’s the danger of buying after historic single-day surges, including the ones that the sell-side analysts are in a rush to upgrade and praise.
At this juncture, late buyers might be wondering if it’s a good idea to…
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