Has technology hit rock bottom? That’s the question investors have been asking since relief returned on the last trading day of March, marking the end of the first quarter. The tech-heavy Nasdaq had closed higher in each of its past four sessions before falling on Tuesday on concerns about President Donald Trump’s deadline for dealing with Iran. Indeed, almost a week into the second quarter, it’s nice to think that technology companies can regain market leadership. However, it is difficult to say with certainty whether technology is out of the woods, given the likelihood of a major escalation of the Iran war within hours and the associated significant risk that the situation will spiral out of control and oil prices will remain high for an extended period of time. That said, the sector is certainly becoming more attractive from a valuation perspective. And if timing the market isn’t your game, and of course we don’t think it should be, it may be time to start thinking about whether your company’s technology exposure is where it should be as the market starts to regain some of the lost ground. The Nasdaq closed at an all-time high of 23,958 on October 29, 2025. After a rocky start to the year, the index was within striking distance of its all-time high in late January. It’s been downhill since then, briefly dipping into correction territory in late March, down more than 10% from recent highs. Certainly, we may see new lows down the road. That is always a possibility, especially if relations with Iran start to get out of hand. But based on some analyst notes, it’s clear that the Street is starting to become a bit more positive on the tech sector. Is it time to buy technology? Goldman Sachs on Tuesday identified three contributing factors: concerns about hyperscalers’ overspending. Destroying enterprise software with AI. And the rotation into heavy asset low obsolescence (HALO) stocks contributed to the tech sector’s “one of the worst periods of relative underperformance” since the early 1970s. As a result, analysts noted that valuations for tech companies are now lower, with valuations for U.S. hyperscalers roughly in line with the rest of the market. In other words, hyperscale companies are currently valued at the same level as the average U.S. large-cap stock, despite superior growth prospects. This happened because estimate revisions were positive while price trends were negative. In fact, analysts said the tech industry’s earnings revisions were actually better than other sectors of the market, creating a “record gap between performance and underlying earnings growth.” Perhaps most interestingly, the analysts concluded that while the technology is already attractive on its own fundamental merits, it could also be seen as a hiding place if disruptions in the Strait of Hormuz last longer than expected. “[The technology industry]may become more defensive in the coming months,” Goldman said. Big tech companies are less dependent on the health of the economy to grow. Wells Fargo Investment Institute (WFII) upgraded the tech sector from neutral to favorable, saying secular AI tailwinds should continue to drive the sector’s sales and profits outpacing the market through the remainder of the year. “We believe the pessimistic sentiment surrounding the sector is overdone, as the gradual drawdown over the past few months has pushed valuations to more attractive levels,” WFII said. The strategists also pointed to the sector’s defensive nature, highlighting that information technology “has outperformed the S&P 500 index since the outbreak of war due to its long-term growth and quality characteristics.” Pushing the fundamental resilience argument home, UBS analysts said they expect year-on-year revenue growth for what they call the Tech+ cohort, which includes information technology stocks and stocks such as Amazon, Alphabet and Metaplatform, to accelerate to 23% in the first quarter. They expect Tech+’s earnings to increase 30.4% in the first quarter, compared to just 5.1% for the rest of the S&P 500. More attractive valuations aren’t necessarily enough to turn investors bullish. However, as positive updates trickle in, they should be beneficial to those of us in the market over the long term. Is Broadcom mojo back? This is especially true when the news is about expanding material and long-term partnerships. On Monday night, Broadcom announced a deal with Alphabet’s Google to develop and supply future generations of TPUs, custom silicon that the two companies have been co-developing for years, through 2031. Broadcom also supplies networking and other components used in Google data centers. Separately, Broadcom, Google, and Anthropic announced an expanded partnership that will give Anthropic access to 3.5 gigawatts worth of TPU-based AI computing starting in 2027. Previous conditions required 3GW. The deal will depend on Anthropic’s ability to continue to grow, but that doesn’t seem to be an issue at this point. Anthropic said demand for its Claude AI models continues to accelerate into 2026, and the company currently operates with run-rate sales of $30 billion, up from approximately $9 billion in 2025. Taken together, this news will certainly help allay any Broadcom concerns we had following last week’s news that Nvidia and Broadcom competitor Marvell Technologies would be collaborating on a system that combines Nvidia’s ecosystem and hardware with Marvell’s custom chips. Solution. It should also allay investors’ fears that Alphabet might expand collaboration beyond Broadcom or bring the design process in-house, similar to Apple’s efforts in recent years. Jim Cramer admitted his knee-jerk reaction to Tuesday’s Broadcom rally was to cut back some. However, given the three-month decline from its all-time high in December 2025, Jim ultimately concluded that the move should hold. “Don’t sell it,” he said. “We’re finally coming out of the problems we’ve had.” Conclusion While it’s too uncertain to call it a tech bottom, we tend to agree with Wall Street analysts that the sector’s valuations are too cheap to ignore. Stock prices may be down this year, but the businesses these stocks represent are as strong as ever, as Tuesday’s news from Broadcom shows, and as the sector’s upward earnings revision clearly shows. Falling valuations have made these stocks attractive. This is true not only if the war is resolved and the Fed clears the way for interest rate cuts, but also if the war intensifies and growth concerns arise, resulting in a search for stocks that will grow regardless of broader economic growth trends. (Jim Cramer’s charitable trusts are long NVDA, AVGO, and GOOGL. See here for a complete list of stocks.) 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