A Biden-run administration focused on kickstarting the pandemic-paralyzed U.S. economy with trillions in infrastructure spending, specifically clean energy and technology, means its still early innings for tech stocks, even with valuations at current levels.
Tax credits and other initiatives to bolster clean and green energy, including electric vehicle development and production, as well as renewed focus on cybersecurity and other currently vulnerable areas mean that the long-term outlook for tech stocks is extremely favorable, says Dan Ives, managing director of equity research with Wedbush Securities.
"The green agenda - there's going to be major changes that are going to benefit all kinds of green companies," Ives told TheStreet.com. "I think you're also going to see a significant spending lift, particularly on cybersecurity, that's going to disproportionately benefit the likes of a Palantir (PLTR) - Get Palantir Technologies Inc. Class A Report, a ZScaler (ZS) - Get Zscaler Inc. Report or Tenable (TENB) - Get Tenable Holdings Inc. Report."
A ratcheting down of tensions with China will also give tech stocks an additional boost - something that's bullish for semiconductor makers but also for the likes of Apple (AAPL) - Get Apple Inc. Report and Alibaba (BABA) - Get Alibaba Group Holding Limited American Depositary Shares each representing eight Report, Ives said.
"if you combine all that together with what we see as unparalleled backdrop in tech, it's still a green light. And I think the goldilocks scenario in what we're seeing in the Beltway right now means tech stocks in general have a lot further to run."
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