Latest news with #iSharesExpandedTech-SoftwareSectorETF
Yahoo
an hour ago
- Business
- Yahoo
Cloud Powers Oracle's Q4 Earnings: ETFs to Gain
Oracle ORCL reported solid fourth-quarter fiscal 2025 results on Wednesday after the bell, outpacing earnings and revenue estimates. It lifted its fiscal 2026 revenue growth forecast, citing robust demand for its cloud offerings from companies deploying artificial shares popped up about 8% in after-market hours on elevated volumes. The smooth trading is likely to prevail in the ETFs with the highest allocation to this software giant. These include Pacer Data and Digital Revolution ETF TRFK, iShares Expanded Tech-Software Sector ETF IGV, Janus Henderson Transformational Growth ETF JXX, First Trust NASDAQ Technology Dividend Index Fund TDIV, and FT Vest Technology Dividend Target Income ETF TDVI. The company's fourth-quarter fiscal 2025 earnings per share were $1.70, which beat the Zacks Consensus Estimate of $1.64 and improved from the year-ago earnings of $1.63. Revenues rose 11% year over year to $15.9 billion and edged past the Zacks Consensus Estimate of $15.54 billion (see: all the Technology ETFs here). The business is booming due to soaring demand for computing power that can handle artificial intelligence projects. Revenues from its cloud infrastructure unit soared 52% year over year to $3 has raised its annual revenue growth forecast for fiscal 2026. It now expects total revenues to reach at least $67 billion. This reflects an anticipated year-over-year growth of approximately 16.7%, up from its previous estimate of 15%. The upward revision underscores Oracle's confidence in sustained demand for its cloud services, which continue to be a key driver of the company's growth Safra Catz said cloud infrastructure revenues will increase more than 70% in fiscal 2026, up from 50% growth in fiscal 2025. Going forward, Oracle will likely exceed the $104 billion revenue target for fiscal 2029, Catz added. Let us delve into each ETF below:Pacer Data and Digital Revolution ETF (TRFK)Pacer Data and Digital Revolution ETF aims to offer investors exposure to globally listed stocks and depositary receipts of data and digital revolution companies. It follows the Pacer Data Transmission and Communication Revolution Index, holding 87 stocks in its basket. Oracle takes the third spot, accounting for 10.5% of the assets. Pacer Data and Digital Revolution ETF has accumulated $63.6 million in its asset base and charges 60 bps in annual fees. It trades in an average daily volume of 8,000 Expanded Tech-Software Sector ETF (IGV)iShares Expanded Tech-Software Sector ETF provides exposure to software companies in the technology and communication services sectors by tracking the S&P North American Expanded Technology Software Index. It holds a basket of 115 securities, with Oracle taking the third spot at 8.5% of the total assets (read: Salesforce to Buy Informatica in an $8 Billion AI Move: ETFs in Focus). iShares Expanded Tech-Software Sector ETF is popular, with an AUM of $11.8 billion. Its volume is good as it exchanges 4 million shares a day. IGV charges 41 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a High risk Henderson Transformational Growth ETF (JXX)Janus Henderson Transformational Growth ETF seeks to invest in companies benefiting from durable trends transforming society, including AI, deglobalization, health care innovation, digitization, and migration to the cloud. It holds 24 stocks in its basket, with Oracle taking the second spot at 8.1% of assets. Information technology, consumer discretionary, financials and healthcare are the top four sectors with double-digit exposure each. Janus Henderson Transformational Growth ETF has gathered $23.5 million in its asset base and charges 57 bps in annual fees. First Trust NASDAQ Technology Dividend Index Fund (TDIV)First Trust NASDAQ Technology Dividend Index Fund provides exposure to dividend payers in the technology sector by tracking the Nasdaq Technology Dividend Index. TDIV holds about 88 securities in its basket. Of these firms, ORCL occupies the fifth position, making up 6.8% of the Trust NASDAQ Technology Dividend Index Fund has $3.1 billion in its asset base and trades in a moderate volume of about 124,000 shares per day. The ETF charges 50 bps in annual fees (read: 5 Dividend ETFs Hovering Around a 52-Week High).FT Vest Technology Dividend Target Income ETF (TDVI)FT Vest Technology Dividend Target Income ETF is an actively managed fund that seeks to provide a target level of current income and capital appreciation by holding a portfolio of dividend-paying U.S. technology companies. The fund invests primarily in U.S. securities contained in the Nasdaq Technology Dividend Index and by utilizing an "option strategy" consisting of writing (selling) U.S. exchange-traded call options on the Nasdaq-100 Index and/or the S&P 500 Index or exchange-traded funds that track the Nasdaq-100 Index or the S&P 500 Vest Technology Dividend Target Income ETF holds 88 securities in its basket, with ORCL taking the fifth spot at 6.8% share. It has accumulated $91.1 million in its asset base and trades in a volume of 19,000 shares per day on average. TDVI charges 75 bps in annual fees. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Oracle Corporation (ORCL) : Free Stock Analysis Report First Trust NASDAQ Technology Dividend ETF (TDIV): ETF Research Reports iShares Expanded Tech-Software Sector ETF (IGV): ETF Research Reports Pacer Data and Digital Revolution ETF (TRFK): ETF Research Reports FT Vest Technology Dividend Target Income ETF (TDVI): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
8 hours ago
- Business
- CNBC
Best Stocks: A cybersecurity giant with a red hot AI business and shares poised for a breakout
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — We've written about two cybersecurity giants in our Best Stocks column in recent weeks, CrowdStrike and Zscaler, both of which remain on the list and represent solid leadership within the software industry group. If you've been making money on those names, you'll be delighted to hear that we've got another write-up in the group. When Palo Alto Networks (PANW) hit the list last week, Sean was pumped to get the opportunity to talk about it. Palo Alto is a 20-year old company that was added to the S & P 500 in 2023. It is currently the largest cybersecurity stock in America with a $130 billion market cap, just ahead of CrowdStrike. With Palo Alto, investors get three businesses in one: Strata is their network security platform while Prisma secures the cloud. And then there is Cortex, the AI and automation business, which is currently on fire. Last week CEO Nikesh Arora, one of the most respected executives in Silicon Valley, announced a consolidation of Prisma under the Cortex brand in order to underscore the importance of AI within the company. Speaking at the Bank of America Global Technology Conference on June 3rd, Arora reaffirmed Palo Alto's target to double the business over the next five years. This is a strong stock in a strong sector. Sean's going to lay out the backdrop for you and then share some stuff about why this name is acting so well. Best stock spotlight: Palo Alto Networks Inc (PANW) On the list since: 6/6/2025 Sean — Tech is increasingly becoming the engine of this market. Tariffs may be dominating the headlines, but tech has held its ground, continuing its relative strength that we've seen over the past decade. Via Factset, first-quarter earnings reported by the Mag 7 exceeded estimates by 14.9%, compared to 8.2% for all S & P 500 companies. The Mag 7's actual earnings grew 27.7% from the same period a year ago. Alphabet, Amazon, and Nvidia were among the top 5 contributors to earnings growth for the S & P 500 in Q1. Within the Mag 7, the software-oriented names have outperformed the hardware/discretionary names: The top 2 performers YTD are Meta up 20% and Microsoft up 13%, while the bottom 2 performers are Apple down 19% and Tesla down 18%. Within tech, software is one of the best-performing industries. The iShares Expanded Tech-Software Sector ETF (IGV) , a popular Software ETF, is up 7% YTD and up 33% over the past year, compared to the Invesco QQQ Trust (QQQ) up 4% YTD and up 12% over the past year. Looking at all software-classified stocks within the S & P 500, 90% are currently trading above their 50-day moving average, and 68% are above their 200-day moving average. These stocks sit a median of 9% below their 52-week highs and have a median Relative Strength Index of 58. In comparison, the QQQs show slightly weaker breadth: 85% of its constituents are above their 50-day moving average and 63% are above their 200-day. The Qs are a median 13% below 52-week highs, with a median RSI of 59. This indicates that while both groups are exhibiting strength, Software stocks within the S & P 500 are showing slightly better technical positioning relative to the broader tech-heavy index. Software is the best-in-breed of an already high-performing tech sector. On our list, software makes up the most populous industry with 9 companies: ANSS , CDNS , CRWD , INTU , MSFT , PANW , PLTR , ROP , and ZS . Major breakout? PANW was added to the list late last week. Palo Alto Networks is a platform-based cybersecurity firm focused on network security, cloud security, and general security operations with over 80k enterprise customers. This is PANW's quarterly gross profit since inception, up and to the right: As of PANW's latest earnings report, the company reported $5 billion in annualized recurring revenue (ARR) from its next-generation security (NGS) offerings — a 34% YoY increase. The company expects this momentum to continue, projecting $5.52 billion to $5.57 billion in ARR for Q4, representing 31–32% growth. This strong performance is being driven by demand for AI-powered security solutions, SASE, and software firewalls. The company is also seeing deep traction with large enterprises: 130 customers now generate over $5 million in ARR, and 44 bring in over $10 million. Management's strategy is to have 60–70% of ARR come from these "platformized" clients, supporting long-term scalability and revenue durability. According to management, with this growth trajectory and customer engagement, Palo Alto remains confident in its path toward a $15 billion ARR target by fiscal 2030. (data via Quartr) The stock just recently bounced off its 50- and 200-day moving average. If it can get to the $200 range, we could be in for a major breakout, joining an elite software industry thus far in 2025. Risk management Josh — That bounce Sean is referring to happened exactly where the bulls needed it to. After PANW reported earnings on May 20th, it gapped lower but the buyers stepped up at the $182-$185 level. They bought it at the 200-day and it never closed below. I'd keep it simple and watch for a close below to tell me something's changed. As far as an entry is concerned, a true technician would wait for the breakout above $200 and watch for convincing volume before starting a position. The risk of anticipating the breakout is more chop below that level and potentially being stopped out. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. INVESTING INVOLVES RISK. EXAMPLES OF ANALYSIS CONTAINED IN THIS ARTICLE ARE ONLY EXAMPLES. THE VIEWS AND OPINIONS EXPRESSED ARE THOSE OF THE CONTRIBUTORS AND DO NOT NECESSARILY REFLECT THE OFFICIAL POLICY OR POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC. JOSH BROWN IS THE CEO OF RITHOLTZ WEALTH MANAGEMENT AND MAY MAINTAIN A SECURITY POSITION IN THE SECURITIES DISCUSSED. ASSUMPTIONS MADE WITHIN THE ANALYSIS ARE NOT REFLECTIVE OF THE POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC" TO THE END OF OR OUR DISCLOSURE. Click here for the full disclaimer.
Yahoo
a day ago
- Business
- Yahoo
Should You Invest in the iShares Expanded Tech-Software Sector ETF (IGV)?
Looking for broad exposure to the Technology - Software segment of the equity market? You should consider the iShares Expanded Tech-Software Sector ETF (IGV), a passively managed exchange traded fund launched on 07/10/2001. While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency. Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Software is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%. The fund is sponsored by Blackrock. It has amassed assets over $11.69 billion, making it one of the largest ETFs attempting to match the performance of the Technology - Software segment of the equity market. IGV seeks to match the performance of the S&P North American Technology-Software Index before fees and expenses. The S&P North American Expanded Technology Software Index comprises of North American equities in the software industry and select North American equities from interactive home entertainment and interactive media and services industries. Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio. Annual operating expenses for this ETF are 0.41%, making it on par with most peer products in the space. While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis. This ETF has heaviest allocation in the Information Technology sector--about 97.10% of the portfolio. Looking at individual holdings, Microsoft Corp (MSFT) accounts for about 8.77% of total assets, followed by Salesforce Inc (CRM) and Oracle Corp (ORCL). The top 10 holdings account for about 59.51% of total assets under management. Year-to-date, the iShares Expanded Tech-Software Sector ETF return is roughly 5.75% so far, and was up about 31.35% over the last 12 months (as of 06/11/2025). IGV has traded between $77.94 and $110.05 in this past 52-week period. The ETF has a beta of 1.15 and standard deviation of 26.21% for the trailing three-year period, making it a high risk choice in the space. With about 120 holdings, it effectively diversifies company-specific risk. IShares Expanded Tech-Software Sector ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IGV is an excellent option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well. Invesco AI and Next Gen Software ETF (IGPT) tracks STOXX WORLD AC NEXGEN SOFTWARE DEV ID and the SPDR S&P Software & Services ETF (XSW) tracks S&P Software & Services Select Industry Index. Invesco AI and Next Gen Software ETF has $443.02 million in assets, SPDR S&P Software & Services ETF has $529.58 million. IGPT has an expense ratio of 0.58% and XSW charges 0.35%. To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report iShares Expanded Tech-Software Sector ETF (IGV): ETF Research Reports Microsoft Corporation (MSFT) : Free Stock Analysis Report Salesforce Inc. (CRM) : Free Stock Analysis Report Oracle Corporation (ORCL) : Free Stock Analysis Report SPDR S&P Software & Services ETF (XSW): ETF Research Reports Invesco AI and Next Gen Software ETF (IGPT): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
06-03-2025
- Business
- Reuters
As US chip darlings struggle, some bet on software as next big AI play
March 6 (Reuters) - U.S. chip stocks were the biggest beneficiaries of last year's artificial intelligence investment craze, but they have stumbled so far this year, with investors moving their focus to software companies in search of the next best thing in the AI play. Tariff-driven volatility and a dimming demand outlook following the emergence of lower cost AI models from China's DeepSeek have shifted the spotlight away from semiconductor shares. Several analysts see software's rise as a longer-term evolution as attention shifts from the components of AI infrastructure. There has been a pretty clear rotation in part due to DeepSeek, the semiconductor outperformance last year and restrictions on U.S. chip exports to China, said David Russell, global head of market strategy at TradeStation. "Investors are looking for the next three-to-five-year stories ... those companies that are going to benefit from what Nvidia has already done." The Philadelphia SE Semiconductor index (.SOX), opens new tab has dropped 5.6% this year, while industry heavyweight Nvidia (NVDA.O), opens new tab has slumped nearly 13%. In contrast, some software companies have rallied, with Atlassian (TEAM.O), opens new tab, CrowdStrike Holdings (CRWD.O), opens new tab, Palantir Technologies (PLTR.O), opens new tab and Cognizant (CTSH.O), opens new tab up between 7% and 19%. Exchange-traded funds tracking software companies have also notched inflows. The iShares Expanded Tech-Software Sector ETF has pulled in over $1.87 billion this year through February 28, according to Morningstar data, compared with more than $1 billion in outflows each for the iShares Semiconductor ETF (SOXX.O), opens new tab and the VanEck Semiconductor ETF (SMH.O), opens new tab. The inflows to the IGV fund have already outpaced last year's total net inflows of $446 million, VettaFi data showed. The iShares and VanEck chip ETFs pulled in $2.46 billion and $6.55 billion, respectively, in 2024. The shift is a natural progression for AI investing as the use cases for the technology are primarily in software, said Adam Turnquist, chief technical strategist at LPL Financial. LPL, an investment advisory firm, favors software over chips. Morgan Stanley also favors software companies as adoption of AI tech increases. "The second stage of the innovation cycle is when people start utilizing products and that's when the software companies start getting paid ... we're now starting to see the ascendancy of the software part of the equation," said Keith Weiss, equity analyst at Morgan Stanley. The shift comes as investors question how much longer chips can maintain 2024's rate of growth, when many software companies underperformed. DeepSeek 's lower-priced chatbot highlighted how competition will drive down profits for direct-to-consumer AI products and enterprise software companies may find it easier to monetize new technology, said Brian Mulberry, portfolio manager at Zacks Investment Management, who has trimmed holdings of Nvidia since last June. Semiconductor stocks have also been affected by an escalating Sino-U.S. trade war. DIVERGENT TRENDS Analysts who spoke to Reuters named companies including Palantir (PLTR.O), opens new tab, Microsoft (MSFT.O), opens new tab, Oracle (ORCL.N), opens new tab and Salesforce (CRM.N), opens new tab as favored software plays. However, performance of these stocks has diverged sharply this year. Palantir, which sells AI software to companies, has rallied. Microsoft and Salesforce are down 4.9% and 12.6%, respectively, hit by a broader selloff in U.S. stocks and as AI returns have yet to meaningfully show up on corporate balance sheets. Morgan Stanley's Weiss said it could take until 2026 for those returns to benefit some companies. Valuations are still expensive, with Microsoft and Oracle trading around 27 and 23 times forward earnings, respectively, compared with Nvidia's 24.6, according to data compiled by LSEG. Still, some investors are willing to play the long game. "We don't need more Nvidia chips, we need applications," said Lisa Shalett, chief investment officer, Morgan Stanley Wealth Management.
