"Wal Street veterans" echoed Wells Fargo's bullish view: US tech stocks have lost their appeal, making long-term investment a "tempting buying point."

Veteran strategist Ed Yardeni says that after pulling back from last year's record highs, US tech stocks have returned to attractive levels for investors willing to make long-term investments. The uncertainty surrounding the impact of artificial intelligence on the software industry, as well as the effects of the Iran war, have led information technology stocks to fall by 13% since hitting a historical high in October last year. During this period, earnings expectations in the industry have accelerated, resulting in a price-to-earnings ratio of 20.6 times, basically on par with the S&P 500 index's P/E ratio of 19.6 times. "For investors looking at a longer-term horizon, this is a very attractive entry point," Yardeni wrote in a report sent to clients last Sunday. The S&P 500 Information Technology Index closed up 0.5% on Monday, marking the fourth consecutive trading day of gains, the longest winning streak since the end of January. However, factors such as overvaluation, the potential disruption of the software industry by artificial intelligence, and risk aversion sentiments have led to a 7.1% decline in the sector so far this year. Information technology and communication services sectors make up the majority of the market value in the S&P 500 index. Yardeni stated that this proportion has exceeded the peak during the dot-com bubble era. He pointed out that although this comparison may make some people uneasy, the current market concentration in information technology and communication services sectors is "more profit-supported" compared to 26 years ago. "Now, the expected earnings of these two industries account for 42.0% of the total, only 1.6 percentage points higher than their market value share," Yardeni said. "During the dot-com bubble peak, the gap between market value share and earnings share was over 15 percentage points. The current concentration is justified." Yardeni is not the only investor who believes that tech stock valuations have reached attractive levels. The investment research institute of Fidelity Bank has upgraded the sector from "neutral" to "optimistic" because the sector has underperformed the S&P 500 index and the widespread application of artificial intelligence supports its strong growth prospects. The company's global investment strategy team stated that despite concerns about valuation, capital spending, and the disruptive impact of artificial intelligence, the fundamentals of the information technology industry remain strong. They cited double-digit earnings growth in the fourth quarter as an example. The strategists also noted that since the outbreak of the US-Iran war, the performance of the information technology industry has been better than the S&P 500 index, highlighting the long-term quality characteristics of the industry. "The gradual pullback in recent months has brought valuations to more attractive levels, and we believe that the pessimism surrounding this industry has gone too far," the company's strategists said.