With Microsoft (NASDAQ:MSFT) nosediving following the release of its latest second-quarter earnings results, the Magnificent Seven could easily continue dragging their feet through the third quarter. Undoubtedly, the July tech correction may just drag into August, and perhaps even September, one of the least exciting months for stocks from a historical perspective. Either way, investors who wanted a shot to pick up the dominant mega-cap tech titans (like the Magnificent Seven stocks) will have a chance to do so over the coming sessions.
Despite recent volatility hitting markets, though, a class of rebounding tech stocks may just be able to shrug off the Nasdaq 100’s latest plunge into correction territory. Of course, no stock is immune from market-wide turbulence should the rest of the Magnificent Seven’s numbers continue to disappoint the crowds.
Either way, the recent resilience in the following tech plays is remarkable. Let’s check in with three names that may just be able to keep rebounding as tech continues its tumble.
IBM (IBM)
IBM (NYSE:IBM) stock didn’t seem to get the memo that mega-cap tech is supposed to be selling off to finish the month of July. Shares of the legacy tech firm have really picked up momentum of late, now up close to 15% in the past three months and just a hair shy of its 10-year high.
Indeed, IBM stock isn’t just a resilient and rebounding tech play that could dodge and weave past the heavy punches thrown the tech sector’s way, but it’s also one of the most underrated long-term ways to bet on AI.
Like many Magnificent Seven members funneling tons of cash into generative AI efforts, IBM has also been spending a great deal for a chance to ride on the back of the AI bull. With the watsonx data platform and various other generative AI projects going on behind the scenes, investors now have much to love about the more than century-old tech firm as it inches back on the growth track.
Accenture (ACN)
Accenture (NYSE:ACN) is another large-cap tech-savvy titan that couldn’t be bothered by the recent tech-wide sell-off sparked by the latest Magnificent Seven earnings season. At writing, ACN stock is up close to 17% since the start of June.
Though still down over 18% from late-2021 all-time highs, shares of the consultant and outsourcing service provider’s newfound momentum may just carry through September, even as the rest of the market officially plunges into a correction.
Accenture’s outsourcing business could be given a bigger lift as firms seek to hop aboard the AI bandwagon. Indeed, Accenture has the AI expertise to help many firms get up to speed in the rapidly evolving AI age. Recently, the company entered a deal to buy silicon design firm Cientra, a move Baird thinks will boost its innovation capabilities.
Given the AI tailwinds and its ever-improving tech expertise, ACN stock looks way too cheap at 25.1 times forward price-to-earnings (P/E).
GoDaddy (GDDY)
GoDaddy (NASDAQ:GDDY) is a web host, site builder tool provider, and registrar that has been on an unstoppable rally since late October last year. Since then, GDDY stock has surged around 100%.
Now off around 2% from all-time highs, questions linger as to whether shares of the AI-leveraging web kingpin will join the Magnificent Seven (and most of tech) for a tumble or continue bucking the trend by adding to its latest melt-up.
Given recent applaud-worthy quarters and the longer-term growth potential behind GoDaddy Airo, its AI-enhanced tools for small businesses, I’d not sleep on the $20.27 billion momentum stock while it’s going for just 12.4 times trailing P/E. Given GoDaddy’s AI opportunity and sound standing among small and medium-sized businesses, the current multiple remains way too low.
On the date of publication, Joey Frenette held a long position in Microsoft. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
