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A recent sell-off in technology has kept some investors from investing in growth names for fear of further price rises. By following some principles, investors can teach themselves to play the market and make profitable bets in the sector, says Tom Fort of DA Davidson. The analyst, who has covered the industry since 1996, shares 13 exit routes that investors should consider when entering tech stocks. Those key concepts include social selling, global expansion, payments and artificial intelligence, which the company uses to score tech companies and identify their strengths and weaknesses. Here are some of the best stocks that Forte believes are in a good position to capitalize on these ideas. Apple stock has fared the best among the big tech names, down more than 5% this year. Forte expects the iPhone maker to boost sales, thanks to its global expansion and the company’s push into mobile and payments. Apple and Google are both names that use social networks – or fort social selling – as a great place to connect with consumers. In addition, both companies said that they control almost 100% of mobile operating systems. “Apple and Google are acting in their own, individual interests when it comes to privacy,” Fort wrote. “As a result, it is very difficult for some social media companies to generate digital advertising revenue.” Many tech stocks benefited in the early days of the outbreak, but have fallen in recent months as prices surged and geopolitical issues flared up abroad. High interest rates are especially hard on tech stocks because they reduce the value of these companies’ future cash flows. Forte believes Amazon, Roku and Shopify are among a handful of companies that could post double-digit compound annual growth rates in sales between fiscal 2021 and 2024, even in this macro environment. Roku shares have rallied nearly 69% this year as the ad market comes under pressure. Last month, the company’s stock rallied 23% in one day after missing estimates on the top and bottom lines and giving disappointing guidance. Going forward, Forte believes the company can see long-term sales growth of 14.3% CAGR as the company benefits from high-definition video, mobile and expansion into international markets. — CNBC’s Michael Blue contributed reporting.
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