FTEC: Big Tech Will Likely Get Bigger In 2027

The Sunday Investor 7.43K Followers Follow Summary Fidelity MSCI Information Technology Index ETF offers passive cap-weighted exposure to almost 300 U.S. tech stocks, maintaining strong appeal despite a potential rotation to value. FTEC boasts a projected 28.84% next-year EPS growth rate and a 31.98x TTM P/E that's below its five-year average. Tech P/Es may compress by 25% in a downturn, but this would need to be accompanied by a substantial EPS forecast miss to have a serious impact on investors. More likely, I expect more moderate compression and for 20%+ EPS growth to materialize, leaving tech investors with a still-healthy total return even in a value re-rating. Since the reward appears to far outweigh the risk, I've assigned FTEC a "buy" rating. FabrikaCr/iStock via Getty Images Investment Thesis Even under the threat of a "rotation to value," the Fidelity MSCI Information Technology Index ETF ( FTEC ) is an appealing choice for investors seeking passive exposure to some of the highest-quality tech companies This article was written by The Sunday Investor 7.43K Followers Follow The Sunday Investor is focused exclusively on U.S. Equity ETFs. He has a strong analytical background, has received a Certificate of Advanced Investment Advice from the Canadian Securities Institute, and has completed all the educational requirements for the Chartered Investment Manager designation.Having covered hundreds of ETFs on Seeking Alpha, The Sunday Investor has developed a complex, proprietary ETF Rankings system which he shares on his website, etf-rankings.com. Nearly 1,000 ETFs receive individual factor scores covering costs, liquidity, risk, size, value, dividends, growth, quality, momentum, and sentiment, which feed into an easy-to-understand composite score from 1-10. The Sunday Investor is always active in the comments section in his articles - please don't hesitate to reach out via comment in any article or by visiting etf-rankings.com. Happy Investing! Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.