Why Big Tech Stocks Remain a Buy Despite Recent Slump

Big tech stocks slumped this week due to valuation concerns and macroeconomic jitters. However, analysts say to stay bullish on tech giants as they are expected to continue strong revenue and earnings growth. Mega-cap tech stocks are more under-owned by large institutional money managers than at any point in the last 16 years, according to Morgan Stanley. UBS analysts note that Big Tech should soon see margins benefit from AI efficiencies.

Big tech stocks experienced a significant dip this week due to valuation concerns and macroeconomic jitters, according to recent financial reports. However, analysts remain optimistic about the long-term prospects of these tech giants, expecting continued strong revenue and earnings growth. Mega-cap tech stocks are currently more under-owned by large institutional money managers than at any point in the last 16 years, as per Morgan Stanley [2].

Despite the recent slump, analysts argue that big tech companies are poised to benefit from AI efficiencies, which could lead to improved margins in the near future. UBS analysts, for instance, highlight the strategic importance of AI in the financial services industry, noting that AI adoption is accelerating innovation and meeting escalating customer expectations [3].

One of the key players in this sector is Cyfrowy Polsat SA, which reported a 3.9% year-over-year revenue increase in the second quarter of 2025, reaching nearly 3.6 billion Zlotys. The company's green energy segment contributed significantly to this growth, with a 41% year-over-year increase in renewable energy production [1]. The near completion of the Jejevo wind farm is expected to double the company's wind capacity, indicating strong confidence from financial institutions [1].

The financial sector's focus on AI and digital transformation is evident in UBS Group's recent investment in Domino Data Lab. This strategic move underscores UBS's commitment to leveraging cutting-edge technology to enhance its financial services offerings [3]. The investment aligns with UBS's broader strategy to innovate and stay competitive in the rapidly evolving financial technology landscape.

While big tech stocks may face challenges in the short term due to valuation concerns and macroeconomic factors, the long-term outlook remains positive. Analysts believe that these companies are well-positioned to benefit from AI efficiencies and continued revenue growth, making them attractive investment opportunities for investors and financial professionals.

References:
[1] https://finance.yahoo.com/news/cyfrowy-polsat-sa-fra-cp9-150034313.html
[2] https://www.marketscreener.com/news/morgan-stanley-rates-qub-as-equal-weight-ce7c50dada89f427
[3] https://www.ainvest.com/news/ubs-group-expands-data-science-domino-data-lab-investment-2508/