The tech industry is booming in 2023, a stark contrast to last year's economic-driven sell-off. Wall Street is increasingly bullish about high-growth markets like artificial intelligence (AI) and cloud computing, with some of the sectors' leaders enjoying monster rallies since Jan. 1.
As tech companies recover from 2022's macroeconomic headwinds, now is an excellent time to consider investing before their shares rise higher. The tech sector is filled with reliable options that have a history of consistent gains over the long term.
And if last year's market volatility proved anything, it's the importance of buying market-leading stocks and holding over many years to safeguard your investments from temporary headwinds.
Here are three great tech-stock buys right now.
1. Apple
As the world's most valuable company, with a market cap of $3 trillion, it's hard to go wrong with Apple (AAPL +0.11%). The stock has risen more than 300% in the last five years, attracting some of the most successful investors.
For instance, Warren Buffett's holding company Berkshire Hathaway has entrusted it with over 46% of its portfolio. The investment has clearly paid off, as Apple's stock has risen more than 635% since Berkshire first invested in 2016.
NASDAQ: AAPL
Key Data Points
One of the biggest reasons to buy this tech stock is its immense brand loyalty from consumers. The company has developed a product model that keeps shoppers returning over the long term, which has seen annual revenue rise 48% in the last five years and operating income increase by 68%.
The company is home to some of the world's most popular products, along with a booming digital services business, making Apple's stock a no-brainer.
2. AMD
Investors have grown particularly bullish about Advanced Micro Devices (AMD +3.47%) this year, with its stock up 79% since Jan. 1. The company's growing potential in AI has strengthened its outlook and gained support from Wall Street.
According to data from Grand View Research, the AI market is expected to have a compound annual growth rate of 37% through 2030. High-powered chips are required to run and develop AI models, making companies like AMD crucial to the market's growth.
NASDAQ: AMD
Key Data Points
The company's biggest competitor, Nvidia, got a head start in the AI chip game. However, AMD has pivoted large parts of its business to the sector in a bid to catch up. The company has enlisted the help of Microsoft (MSFT +1.11%), which is supporting AMD's AI chip expansion with financial and engineering resources.
Meanwhile, AMD's recently released AI graphic processing unit (GPU), the MI300X, has reportedly caught the eye of Amazon Web Services, which is testing it for potential use.
AMD shares have skyrocketed 594% since 2018. A history of growth and solid prospects in AI make it a tech stock worth considering this year.
3. Microsoft
There are a lot of reasons to invest in Microsoft. The company is the second-most-valuable company in the world. Potent products such as Windows, Office, Xbox, Azure, and LinkedIn have bolstered its business and made its stock one of the most reliable investments. Shares gained 243% over the last five years, with annual revenue growth of 58%.
In 2023, Microsoft has strategically become one of the biggest names in AI. The company invested $1 billion in ChatGPT developer OpenAI in 2019 and has since added $10 billion to that figure. The partnership allowed Microsoft to obtain exclusive licenses on some of the start-up's most advanced AI models, giving the Windows company an edge over competitors like Amazon and Alphabet.
NASDAQ: MSFT
Key Data Points
Consequently, in the last six months, Microsoft added AI upgrades to several of its home-grown platforms, such as Word, Excel, and Azure. The company's dominance in productivity software and solid position in cloud computing, paired with OpenAI's technology, could help it become the go-to for anyone seeking AI services.
If that turns out to be the case, Microsoft investors could enjoy massive gains over the long term, making its stock an excellent option right now.
