With Amazon.com Inc. down 33% this year and Meta Platforms Inc. tumbling over 40%, you might expect, or at least hope, the carnage in Big Tech is nearly over. You would probably be wrong, according to Dan Suzuki, deputy chief investment officer at Richard Bernstein Advisors.
Suzuki’s outlook for the sector has been correct so far. In early March, the New York-based strategist published a report describing the six classic signs that indicate tech stocks have hit bottom. His conclusion at the time — that if the tech bubble of more than 20 years ago was any guide, the stocks had farther to fall — has since been borne out.
Suzuki, whose firm takes a top-down, macro approach to the markets and has $15.5 billion under management, says there’s farther to fall even after the recent declines.
In the wake of the recent volatility, Suzuki revisited his six signs for Bloomberg, and gave his assessment of where we are now.
1. Valuations that significantly contract and an IPO market that goes cold. “I would argue that tech and growth stocks are one of the few areas of the market that are still expensive,” he said. “I’m sure IPO activity is going to slow here."
2. Tech and crypto analysts go from being lionized to being viewed as villains. “You are starting to hear some grumblings, but on the whole, I think these ‘experts’ are still viewed as visionaries,” Suzuki said.
3. There are fewer tech-focused products like exchange-traded funds. “I have yet to hear of significant tech and innovation-focused investment products being shut down,” he said.
4. You see the cancellation of tech- and innovation-focused TV and news columns. “This definitely hasn’t happened,” he said. “In fact, tech is all the business media is focused on right now.”