It could be time to code a few tech stock buys into your portfolio.
“The underperformance of the technology sector is also starting to generate attractive valuation opportunities for investors as its valuation, relative to expected consensus growth, has fallen below that of the global aggregate market,” Goldman Sachs strategist Peter Oppenheimer wrote in a new note on Tuesday.
Oppenheimer continued, “These factors have opened up an opportunity in the technology sector where growth rates remain strong, but valuations are now low. In the US, the valuation premium of the technology hyperscalers has fallen to close to the same as the rest of the market.”
Read more: The latest tech stock news and updates
2026 has been unkind to tech stocks for a host of reasons.
The massive increase in capital expenditures by hyperscalers such as Microsoft (MSFT) and Amazon (AMZN) has raised concerns about the potential returns that these companies can achieve from their outsized investments.
Investors have also begun to fret that the costs of this investment are beginning to take a hefty bite out of cash flows and balance-sheet capacity.
Oracle (ORCL) is an extreme example of these concerns: It has had to raise debt and recently laid off 30,000 workers to fund its AI infrastructure build-out ambitions. And other Big Tech players are doing the same.
“The history of technology breakthroughs, from the steam engine to railways, PCs and the internet, is littered with examples of new technologies that attracted large sums of capital to build out underlying infrastructure which have led, ultimately, to low returns,” Oppenheimer explained. “The gains are then enjoyed by other companies, many of which piggyback off the original investment.”
Meanwhile, the boom in hyperscaler spending, together with the release of new versions of large language models (LLMs), has shifted investor fears to the companies that might have the most to lose from AI disruption.
Investors are keen to avoid the AI era’s version of Kodak, IBM (IBM), Nokia (NOK), Blackberry (BB), and several other companies that saw their business models collapse under the weight of new waves of innovation, Oppenheimer said.
The geopolitical shock of the conflict in Iran, which has created a sharp divide between AI winners and consumer/macro losers, hasn’t helped sentiment in tech. In other words, investors have used the uncertain backdrop to rotate into war plays in the oil and defense spaces.
As of early April 2026, the “Magnificent Seven” group of stocks has lost a collective $1.1 trillion in market cap.