Screening Filters
Market Cap ≥ $10,000,000,000 (Large-cap only)
- Purpose: Focus on larger, more established tech companies.
- Rationale:
- “Good” tech stocks often implies stability, proven business models, and liquidity.
- Large-cap firms (≥ $10B) are generally less volatile, have stronger balance sheets, and are widely followed by analysts, which reduces the risk of unknowns compared with small, speculative names.
Sector: Software & IT Services / Technology / Technology Equipment
- Purpose: Limit results to the core technology space.
- Rationale:
- These sectors encompass most traditional “tech stocks” (software vendors, IT services, hardware, equipment makers).
- It avoids non-tech sectors that might have a small tech angle but aren’t what investors usually mean by “tech stocks.”
Industry: Semiconductors & Equipment, Communications & Networking, Computers/Phones/Electronics, Software & IT Services
- Purpose: Narrow down to key tech industries with strong structural demand.
- Rationale:
- These industries are central to the tech ecosystem: chips, networking gear, consumer devices, and software.
- They include many of the market’s long-term winners and household tech names.
- This avoids fringe or less scalable tech-related niches that may not fit the user’s idea of “good tech stocks.”
Themes: AI Beneficiary, Cloud, Cybersecurity, Semiconductors, SaaS, IoT, 5G, Big Data, Blockchain, E‑Commerce, Digital Payments, etc.
- Purpose: Target companies exposed to major, long-term technology trends.
- Rationale:
- Good tech stocks today are often those benefiting from durable secular growth themes: AI, cloud computing, cybersecurity, digital payments, e‑commerce, etc.
- Thematic filters help ensure the list is not just “tech” by classification, but also positioned in growth areas where demand is likely to expand for years.
Net Margin ≥ 10%
- Purpose: Ensure companies are not just growing, but also meaningfully profitable.
- Rationale:
- A net margin above 10% suggests solid pricing power, cost control, and a sustainable business model.
- Many tech companies can grow fast but lose money; this filter aligns with “good” as in quality and profitability, not just hype or revenue growth at any cost.
5-Year Revenue CAGR ≥ 10%
- Purpose: Require consistent, above-average growth over a multi‑year period.
- Rationale:
- A 10%+ compound annual growth rate in revenue over 5 years points to durable demand and strong execution, not just a one-time spike.
- This matches the idea of “good tech stocks” as companies that have been growing reliably, not stagnating or shrinking.
P/E (TTM) between 10 and 40
- Purpose: Screen for reasonably valued growth—avoid both very cheap (possible value traps) and extremely expensive (highly speculative) names.
- Rationale:
- P/E < 10 in tech can indicate structural problems, slowing business, or one-off accounting issues.
- P/E > 40 often reflects very high expectations and higher downside risk if growth slows.
- A 10–40 range balances growth and valuation: still growth-oriented, but not at any price.
Why Results Match “Good Tech Stocks”
- They are clearly in technology, both by sector/industry and by alignment with major tech themes (AI, cloud, semis, cybersecurity, etc.).
- They are established and liquid (large-cap), which suits most investors looking for “good” rather than purely speculative names.
- They combine solid profitability (net margin ≥ 10%) with sustained growth (5-year revenue CAGR ≥ 10%), indicating quality businesses, not just stories.
- Valuation is screened for reasonableness (P/E 10–40), helping avoid the extremes of distressed and bubble-like tech stocks.
Together, these filters aim to surface large, profitable, growing, thematically relevant tech companies that many investors would consider “good” core or growth holdings rather than speculative bets.
This list is generated based on data from one or more third party data providers. It is provided for informational purposes only by Intellectia.AI, and is not investment advice or a recommendation. Intellectia does not make any warranty or guarantee relating to the accuracy, timeliness or completeness of any third-party information, and the provision of this information does not constitute a recommendation.