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Information technology stocks fell 4.8% on Wednesday, the worst sectorial performance of the S & P 500 index. The new communications services sector, which includes many high-tech companies renamed, fell 3.9%, posting the second worst performance.
It's easy to continue to believe that information technology – and semiconductor manufacturers, to name just one example – is sustainable over the next 10 years, but short-term investors hear it .
But it helps to have a little perspective. "You do not get + 60% a year in NFLX [Netflix] without a few -15% weeks here and there, "wrote in a note Wednesday Michael Antonelli, a stock trader at R.W. Baird & Co.
This has been included in this story about the neglect of value stocks during the bull market and what that could mean when interest rates rise.
Look also: Technology stocks plummet because investors are nervous – here are three reasons why
This chart shows the S & P 500 net price / earnings ratio
SPX, -0.28%
information technology sector over the last 10 years, and helps to explain why the technology is particularly sensitive in this period of rising interest rates and fears of trade war:
FactSet
You can see the technology sector skyrocketing the entire S & P 500 Index.
Using the same chart at the end of 1999, it is clear that technology valuations are not nearly as tight as they were at the time, but that does not reassure investors worried about short-term volatility. term:
FactSet
The worst technology values of October
In order to establish a list of the worst "technological" values of October, we were forced to look not only at the S & P 500 information technology sector, but also at the new communications services sector, which includes Facebook .
FB -0.12%
and alphabet
GOOG, -0.16%
GOOGL, -0.65%
which is the holding company of Google. To go a step further, to make sure we included all the FAANG actions, we entered Amazon.com.
AMZN, -1.07%
Consumer Discretionary Sector.
That left 88 companies, all of which saw their shares fall on Wednesday.
Let's start with the actions FAANG, in the order of the acronym. Here's how they performed until October, with Wednesday's declines and cumulative total returns for the year:
| Total returns | |||||
| Company | Teleprinter | Industry | September 28 to October 10 | October 10 | 2018 to 10 October |
| Facebook Inc. Class A |
FB -0.12% |
Internet software / services | -8.0% | -4.1% | -14.2% |
| Apple Inc. |
AAPL, -0.60% |
Computers / Telecom. Equipment | -4.2% | -4.6% | 29.3% |
| Amazon.com Inc. |
AMZN, -1.07% |
Internet Retail | -12.4% | -6.2% | 50.1% |
| Netflix Inc. |
NFLX, + 0.85% |
Cable / satellite TV | -12.9% | -8.4% | 69.8% |
| Alphabet Inc. Class A |
GOOGL, -0.65% |
Internet software / services | -9.5% | -4.6% | 3.7% |
| Alphabet Inc. Class C |
GOOG, -0.16% |
Internet software / services | -9.4% | -5.1% | 3.3% |
| Source: FactSet | |||||
Despite the mediocre performance of October, three of FAANG's stock still show huge double-digit gains in 2018.
Here are the 20 worst-performing stocks of the October S & P 500 tech:
| Total returns | |||||
| Company | Teleprinter | Industry | September 28 to October 10 | October 10 | 2018 to 10 October |
| Advanced Micro Devices Inc. |
AMD + 0.32% |
Semiconductors | -19.1% | -8.2% | 143.2% |
| ANSYS Inc. |
ANSS, + 0.50% |
Software | -16.6% | -6.1% | 5.5% |
| Microchip Technology Inc. |
MCHP + 0.76% |
Semiconductors | -15.8% | -1.4% | -23.4% |
| IPG Photonics Corp. |
IPGP, -0.50% |
Electronic Equipment / Instruments | -15.6% | -2.2% | -38.5% |
| F5 Networks Inc. |
FFIV, + 0.30% |
Computer Communications | -15.2% | -4.3% | 28.9% |
| Arista Networks Inc. |
A NET, -3.23% |
Computer Communications | -15.1% | -5.4% | -4.2% |
| Akamai Technologies Inc. |
AKAM, + 0.00% |
Internet software / services | -14.6% | -3.7% | -3.9% |
| Autodesk Inc. |
ADSK, -0.50% |
Software | -14.5% | -6.6% | 27.3% |
| PayPal Holdings Inc |
PYPL, + 2.35% |
Data Processing Services | -14.1% | -5.7% | 2.5% |
| Red Hat Inc. |
RHT, + 0.46% |
Software | -13.6% | -4.2% | -2.0% |
| TripAdvisor Inc. |
TRIP, + 0.00% |
Other consumer services | -13.5% | -7.5% | 28.3% |
| Salesforce.com Inc. |
CRM + 0.34% |
Software | -13.3% | -7.2% | 34.8% |
| Netflix Inc. |
NFLX, + 0.85% |
Cable / satellite TV | -12.9% | -8.4% | 69.8% |
| Cadence Design Systems Inc. |
CDNS, + 0.46% |
Electronic production equipment | -12.9% | -4.4% | -5.6% |
| Electronic Arts Inc. |
EA, -0.87% |
Leisure products | -12.7% | -4.0% | 0.1% |
| Nvidia Corp. |
NVDA, -0.78% |
Semiconductors | -12.6% | -7.5% | 27.2% |
| Amazon.com Inc. |
AMZN, -1.07% |
Internet Retail | -12.4% | -6.2% | 50.1% |
| VeriSign Inc. |
VRSN, + 0.38% |
Internet software / services | -12.0% | -4.8% | 23.1% |
| Synopsys Inc. |
SNPS, + 0.56% |
Software | -12.0% | -4.4% | 1.8% |
| Adobe Inc. |
ADBE + 0.76% |
Software | -11.9% | -6.4% | 35.8% |
| Source: FactSet | |||||
You can click on the tickers for more information about each company, including news, profiles, price ratios, ratings, charts and financial data.
As you can see in Advanced Micro Devices, the worst-performing country in October, it's important to have some perspective. The stock is still up 143% for 2018.
Do not miss: Here's a dividend investment strategy designed to outperform bear markets
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