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3 Top Tech Stocks To Buy In August The Motley Fool

Bonisiwe Shabane
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3 top tech stocks to buy in august the motley fool

You need to invest in tech stocks in order to enjoy market-beating returns. While it's important for investors to keep a balanced portfolio, you can't afford to overlook tech stocks in this market. Tech stocks are the muscle behind U.S. markets these days, accounting for 34% of the makeup of the entire S&P 500. They are also outperformers, as the tech-heavy Nasdaq Composite is outperforming both the S&P 500 and the Dow Jones Industrial Average so far this year. The lesson here?

You need to have tech stocks in your portfolio if you want to outperform the market. Tech stocks are immensely popular these days as companies are racing to train large language models (LLMs) to customize their platforms with generative artificial intelligence (AI) offerings in order to roll out new services... The race to build AI products is far from over, and buying stocks that will be best positioned to capitalize on the trend is a smart way to invest right now. If you're looking for the best tech stocks for August, I'm recommending Nvidia (NVDA +2.20%), Alphabet (GOOG +0.41%) (GOOGL +0.36%), and Taiwan Semiconductor Manufacturing (TSM +1.72%). The unquestioned leader in tech stocks right now is chipmaker Nvidia. As the creator of the most advanced graphics processing units (GPUs) that top companies use to power their AI platforms, Nvidia has grown to be the most valuable publicly traded company in the world...

The technology sector is vast, comprising gadget makers, software developers, wireless providers, streaming services, semiconductor companies, and cloud computing providers, to name just a few. Any company that sells a product or service heavily infused with technology likely belongs to the tech sector. These design the software that runs on hardware, such as: Software companies are increasingly moving to a software-as-a-service (SaaS) model in which customers buy a subscription to a program instead of a one-time license. The arrangement generates recurring revenue for the software company. Semiconductor chips largely power the hardware.

Semiconductor companies design and/or manufacture central processing units (CPUs), graphics processing units (GPUs), memory chips, and a wide variety of other chips that help to run today's devices. Telecom companies that provide wireless services support the tech sector, but actually belong to the communications sector; so do the video streaming companies that provide easy access to high-quality content, and the cloud computing... ASML has a technological monopoly on a crucial type of chipmaking equipment. CrowdStrike’s cloud-native cybersecurity platform is still expanding. ServiceNow will profit from the growth of the cloud and AI markets. August generally isn't considered the best time to buy stocks.

It lands between May, when many investors "sell in May and go away," and September, which has historically had a pattern of being the worst month of the year for stocks. But the market's common summer swoons -- which can largely be attributed to the behavioral biases of investors -- shouldn't matter to long-term investors. After all, the S&P 500 has still delivered an average annualized return of about 10% since its inception in 1957. So if you don't mind a little near-term volatility, August can still be a great time to add to your portfolio, and ASML(NASDAQ: ASML), CrowdStrike (NASDAQ: CRWD), and ServiceNow(NYSE: NOW) are three great tech... ASML, CrowdStrike, and ServiceNow are still great long-term buys. August generally isn't considered the best time to buy stocks.

It lands between May, when many investors "sell in May and go away," and September, which has historically had a pattern of being the worst month of the year for stocks. But the market's common summer swoons -- which can largely be attributed to the behavioral biases of investors -- shouldn't matter to long-term investors. After all, the S&P 500 has still delivered an average annualized return of about 10% since its inception in 1957. So if you don't mind a little near-term volatility, August can still be a great time to add to your portfolio, and ASML (ASML +0.38%), CrowdStrike (CRWD +1.60%), and ServiceNow (NOW +0.58%) are three... ASML is the world's top supplier of photolithography systems, which are used to optically etch circuit patterns onto silicon wafers. It's also the only producer of extreme ultraviolet (EUV) lithography machines -- the only ones capable of operating at a fine enough level of detail to make today's most advanced, densest, and most power-efficient...

ASML's monopoly in that crucial technology makes it a linchpin of the semiconductor sector. All of the world's top foundries -- including TSMC, Samsung, and Intel -- use its EUV systems to manufacture cutting-edge chips. With these top tech stocks trading off their highs, now is a good time to buy. Tech stocks have been helping to lead the market higher for much of the past two years, but many have taken a breather in recent weeks. That opens up an opportunity to grab some tech leaders trading off their highs. Let's examine three leading tech stocks to consider buying before the end of the year.

One of the companies best positioned for the ongoing artificial intelligence (AI) infrastructure boom is Taiwan Semiconductor Manufacturing (TSM +0.69%). While competition has increased in the AI chip race, with more companies turning to ASICs to run some of their AI workloads, TSMC remains in a prime position because it is the company that... Manufacturing advanced semiconductors is not easy, and TSMC has proven to be the only company that can consistently manufacture chips at smaller node sizes (the number of transistors that fit on a chip) with... This has made it a key cog in the semiconductor value chain, leading to strong pricing power. It also gives it solid visibility, with the company projecting that AI chip demand will increase by a more-than-40% compound annual growth rate (CAGR) over the next few years. ASML has a technological monopoly on a crucial type of chipmaking equipment.

CrowdStrike’s cloud-native cybersecurity platform is still expanding. ServiceNow will profit from the growth of the cloud and AI markets. August generally isn't considered the best time to buy stocks. It lands between May, when many investors "sell in May and go away," and September, which has historically had a pattern of being the worst month of the year for stocks. But the market's common summer swoons -- which can largely be attributed to the behavioral biases of investors -- shouldn't matter to long-term investors. After all, the S&P 500 has still delivered an average annualized return of about 10% since its inception in 1957.

So if you don't mind a little near-term volatility, August can still be a great time to add to your portfolio, and ASML (NASDAQ: ASML), CrowdStrike (NASDAQ: CRWD), and ServiceNow (NYSE: NOW) are three... These companies are leading the way in tech, and you won't want to miss out. The tech market has been in recovery mode this year after an economic downturn caused a sell-off in 2022. Easing inflation and advances in technology, such as artificial intelligence (AI), have Wall Street particularly bullish. As a result, now is an excellent time to consider expanding your tech holdings before it's too late. Thanks to its ever-developing nature, the tech market can be a lucrative place to invest.

The sector is known for its wealth of growth stocks that can almost guarantee long-term gains. So if you're looking for a reliable way to expand your portfolio, here are three top tech stocks to buy in August. Shares of Apple (AAPL +0.88%) gained 310% since 2018, more than many of the biggest names in tech. The company attracted millions of customers with its priority on quality and its interconnected ecosystem of products. Consumers have proven their preference for Apple's devices time and time again, most recently amid macroeconomic headwinds. Written by Will Healy, Justin Pope, Jake Lerch for The Motley Fool->

Tech conglomerate Sea Limited is sailing a familiar path to growth. Reddit's revenue grew by 78% in its most recent quarter. Investors often look at stocks in terms of what they want to buy. This is understandable as they frequently have money to put to work, and opportunities in specific stocks can disappear after a short time. Still, as many investing experts have taught, time in the market almost always beats timing the market, meaning investors may want to seek a stock that is more than a short-term trade. This is particularly true with tech investing.

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