3 Tech Stocks To Avoid In December

NASDAQ: INTC | Intel Corporation News, Ratings, and Charts

Since the outbreak of the COVID-19 pandemic, technology stocks have been soaring. That’s because people across the world have become more dependent on devices such as mobile phones, computers, laptops, and tablets, among others, to stay functional. Many countries are announcing more stimulus packages to support their economies, and enable people to limit their activity in the second wave.

The S&P 500 and the Nasdaq Composite indexes have recorded a year-to-date increase of 12.6% and 36%, respectively, primarily on the back of the tech stock rally. Zoom Video Communications, Inc. (ZM) and Amazon.com, Inc. (AMZN) are two stocks that benefited the most from the pandemic. While the trend to work and learn remotely has helped ZM gain 593.2% year-to-date, increased online purchases have helped AMZN soar 72.9%. 

While the technology sector has been one of the major beneficiaries of the pandemic-led changes, all tech stocks are not good picks. Intel Corporation (INTC - Get Rating), Stamps.com Inc. (STMP - Get Rating), and Overstock.com, Inc. (OSTK - Get Rating) are three such stocks that witnessed a price decline recently and may face trouble in the future because of their fundamentals. While INTC’s stock slid 21% since its second-quarter earnings on July 23rd, STMP’s and OSTK’s stock fell around 40% since August after rising 272% and 1,630% between January and mid-August. 

Intel Corporation (INTC - Get Rating)

Technology giant INTC was founded in 1968 and has a market cap of $194.45 billion. It was the largest chip manufacturer in the world and dominated the semiconductor industry with its x86 chips. However, all is not well with the company. INTC is losing its share in the semiconductor market to competitors like Taiwan Semiconductor Manufacturing Company Ltd. (TSM), Advanced Micro Devices, Inc. (AMD), NVIDIA Corporation (NVDA), and QUALCOMM Incorporated (QCOM). According to Mercury Research, INTC’s CPU market share has gone down to 79.8% in the third quarter of 2020 from 84.2% in the third quarter of 2019.

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