An increasing reliance technology irrespective of the status of the COVID-19 pandemic makes the long-term prospects bright for technology companies, which are continuously innovating. Given robust tech integration in virtually every industry, we think prominent tech stocks Microsoft (MSFT), Cisco (CSCO), and Broadcom (NASDAQ:AVGO) should deliver solid returns over the long term. Read on.Tech stocks are regaining momentum as businesses worldwide adopt hybrid working structures. Moreover, with robust digitization happening in almost every industry and 5G being deployed widely, tech companies are witnessing surging demand for their products and services. In fact, the robust demand for tech products and solutions and favorable policies for domestic semiconductor chip production have rekindled investors’ enthusiasm for the sector.
Surging investor optimism over the industry’s growth prospects is evident in the iShares U.S. Technology ETF’s (IYW) 7.5% returns over the past month versus the SPDR S&P 500 ETF Trust’s (SPY) 2% gains. In fact, the global tech industry is expected to grow at a 5% CAGR over the next three years.
Given this backdrop, we believe it would be wise to bet on established tech players Microsoft Corporation (NASDAQ:MSFT), Cisco Systems, Inc. (NASDAQ:CSCO), and Broadcom Inc. (AVGO) because they are continuously innovating and are positioned to continue growing.