Technology Sector Report
Market Cap: $40.4T
Stocks: 676
Median P/E: 12.0x
Median ROIC: 4.2%
Data sourced from SEC EDGAR filings. Report refreshed weekly.
The Technology sector encompasses companies involved in the design, development, and distribution of technology-based goods and services. This includes semiconductor manufacturers, software developers, IT services firms, and electronic equipment makers. The sector is typically characterized by high R&D intensity, strong gross margins, and secular growth driven by digital transformation and enterprise modernization.
Performance Dashboard
| Period | Sector (MCW) | Sector (Median) |
|---|---|---|
| 1 Day | -0.5% | 0.0% |
| 1 Week | -1.2% | +0.6% |
| 1 Month | — | — |
| 3 Months | — | — |
| 6 Months | — | — |
| YTD | -2.1% | +0.7% |
| 1 Year | +120.1% | +8.3% |
| 3 Years | +292.3% | +9.4% |
| 5 Years | +363.1% | -32.5% |
Today's Breadth: 279 advancing · 296 declining · 29 flat
Valuation Summary
| Metric | Median | P25 | P75 | vs 5Y Avg |
|---|---|---|---|---|
| P/E | 12.0x | 0.0x | 31.8x | -42% |
| P/B | 1.8x | 0.0x | 4.9x | -44% |
| P/S | 1.1x | 0.0x | 3.8x | — |
| P/FCF | 15.5x | 1.7x | 28.9x | — |
| EV/EBITDA | 16.8x | 10.3x | 25.1x | — |
| EV/EBIT | 21.9x | 13.8x | 32.2x | — |
Earnings Yield
3.3%
FCF Yield
3.5%
Below Fair Value
40% of stocks
Profitability Profile
Margins
| Metric | Median | 5Y Avg | P25 | P75 |
|---|---|---|---|---|
| Gross Margin | 49.9% | 49.5% | 32.8% | 67.2% |
| Operating Margin | 4.5% | — | -5.6% | 15.5% |
| Net Margin | 3.2% | 1.0% | -7.0% | 12.8% |
| FCF Margin | 10.5% | — | 1.7% | 21.1% |
Returns on Capital
| Metric | Median | 5Y Avg | P25 | P75 |
|---|---|---|---|---|
| ROE | 5.8% | — | -10.7% | 19.3% |
| ROA | 1.8% | — | -7.2% | 7.7% |
| ROIC | 4.2% | 2.8% | -7.8% | 16.1% |
Growth Metrics
| Metric | 1Y | 3Y CAGR | 5Y CAGR |
|---|---|---|---|
| Revenue | +7.7% | +6.3% | +10.0% |
| EPS | +22.7% | +6.6% | +10.9% |
| Free Cash Flow | +21.4% | +15.0% | +11.1% |
All values represent sector median growth rates.
Balance Sheet Health
Debt / Equity
0.3x
Net Debt / EBITDA
0.3x
Interest Coverage
4.1x
Current Ratio
1.8x
Altman Z-Score
Safe (>3): 219 (36%)
Gray (1.8–3): 111 (18%)
Distress (<1.8): 272 (45%)
Piotroski F-Score
Strong (7–9): 148 (22%)
Moderate (4–6): 381 (57%)
Weak (0–3): 143 (21%)
Top Companies
| Symbol | #▲ | Mkt Cap | P/E | EV/EBITDA | ROIC | Net Mgn | Rev Gr. | Div Yld | YTD | Qual. |
|---|---|---|---|---|---|---|---|---|---|---|
| NVDA | 1 | $4.8T | 39.1x | 34.8x | 113.6% | 55.6% | +65.5% | 0.0% | -4.6% | 7/9 |
| AAPL | 2 | $4.6T | 34.2x | 26.8x | 93.4% | 26.9% | +6.4% | 0.4% | -1.3% | 6/9 |
| GOOGL | 3 | $4.4T | 29.0x | 25.1x | 36.0% | 32.8% | +15.1% | 0.3% | -1.3% | 5/9 |
| GOOG | 4 | $4.4T | 13.9x | 11.8x | 36.0% | 32.8% | +15.1% | 0.3% | -1.1% | 5/9 |
| MSFT | 5 | $2.9T | 36.1x | 23.3x | 35.8% | 36.1% | +14.9% | 0.7% | -0.5% | 6/9 |
| AVGO | 6 | $1.7T | 84.1x | 58.1x | 20.0% | 36.2% | +23.9% | 0.6% | -2.6% | 6/9 |
| META | 7 | $1.5T | 28.2x | 16.5x | 33.1% | 30.1% | +22.2% | 0.3% | -1.1% | 6/9 |
| MU | 8 | $1.1T | 20.7x | 10.1x | 16.3% | 22.8% | +48.9% | 0.3% | -13.4% | 2/9 |
| TSM | 9 | $1.0T | 28.6x | — | — | 1.2% | +33.9% | 8.0% | +3.1% | 6/9 |
| AMD | 10 | $847.1B | 81.1x | 53.0x | 6.6% | 12.5% | +34.3% | — | -5.8% | 4/9 |
| ASML-AS | 11 | $629.9B | 35.5x | 25.9x | 73.1% | 31.3% | +21.1% | 0.2% | — | 6/9 |
| NOW | 12 | $556.4B | 92.2x | 61.4x | 43.1% | 13.2% | +20.9% | — | +0.8% | 6/9 |
| INTC | 13 | $535.6B | — | 18.2x | -0.2% | -0.5% | -0.5% | — | -6.6% | 1/9 |
| AMAT | 14 | $487.3B | 26.2x | 20.8x | 35.1% | 24.7% | +4.4% | 0.8% | -8.0% | 6/9 |
| CSCO | 15 | $449.9B | 26.3x | 22.9x | 19.1% | 18.0% | +5.3% | 2.4% | -1.5% | 5/9 |
| NTES | 16 | $409.5B | — | — | 33.6% | 4.3% | +7.0% | — | +0.7% | 5/9 |
| ORCL | 17 | $408.6B | — | — | 63.1% | 25.2% | +17.4% | — | -10.0% | 5/9 |
| PLTR | 18 | $333.5B | 299.5x | — | — | 36.3% | +56.2% | — | -5.0% | 2/9 |
| IBM | 19 | $274.6B | 27.2x | 18.6x | 15.0% | 15.7% | +7.6% | 2.2% | +4.3% | 4/9 |
| DELL | 20 | $269.7B | — | — | 41.1% | 5.2% | +18.8% | — | +3.7% | 4/9 |
Industry Composition
| Industry | Stocks | Market Cap | % | |
|---|---|---|---|---|
| Semiconductors & Related Devices | 87 | $12.3T | 30.4% | |
| Services-Computer Programming, Data Processing, Etc. | 49 | $10.7T | 26.5% | |
| Services-Prepackaged Software | 173 | $6.6T | 16.4% | |
| Electronic Computers | 6 | $4.9T | 12.2% | |
| Semiconductors | 8 | $715.3B | 1.8% | |
| Computer Communications Equipment | 11 | $687.9B | 1.7% | |
| Computer Storage Devices | 6 | $680.6B | 1.7% | |
| Computer Peripheral Equipment, Nec | 12 | $384.5B | 1.0% | |
| Industrial Instruments For Measurement, Display, And Control | 17 | $362.2B | 0.9% | |
| Computer & Office Equipment | 3 | $356.3B | 0.9% | |
| Services-Computer Processing & Data Preparation | 54 | $346.4B | 0.9% | |
| Measuring & Controlling Devices, Nec | 11 | $284.3B | 0.7% | |
| Search, Detection, Navigation, Guidance, Aeronautical Sys | 10 | $246.2B | 0.6% | |
| Laboratory Analytical Instruments | 24 | $229.3B | 0.6% | |
| Electronic Connectors | 4 | $211.2B | 0.5% |
Showing top 15 of 41 industries.
Quality Distribution
0
1
2
3
4
5
6
7
8
9
Quality Score (0-9)
High Quality (7+)
4%
Median Piotroski F
5/9
Profitable Years
3 of 10
Dividends & Shareholder Returns
Paying Dividends
21%
Median Div Yield
1.2%
Median Buyback Yield
0.1%
Shareholder Yield
0.5%
Payout Ratio
32.5%
Div Growth (3Y)
5.4%
Div Growth (5Y)
7.4%
Strengths & Weaknesses
Strengths
- +[Valuation]Attractive valuations: current median P/E of 12.0x is 42.3% below the 5-year average, presenting potential value opportunity.
Weaknesses
- −[Financial Health]45.2% of companies fall in the Altman Z-Score distress zone (<1.8), indicating elevated bankruptcy risk within the sector.
- −[Profitability]Below-average capital returns with a median ROIC of 4.2%, suggesting limited pricing power or capital-intensive operations.
- −[Quality]Only 3.6% of companies score 7+ on the quality checklist, reflecting structural challenges in achieving consistent returns across the sector.