Navigating tech stocks is never easy, but if you’re looking to “double-click on tech”, as Yahoo Finance Executive Editor Brian Sozzi likes to say, his guest on Opening Bid this week has some advice. State Street Global Markets head of equity research Marija Veitmane explained that cash flow in a “very cash rich sector and big large companies [with] strong balance sheets” are good metrics to look for when considering stocks.

For full episodes of Opening Bid, watch on our website or listen on your favorite podcast platform.

Video Transcript

And so where are you spending your most time?

You know, I, I imagine.

Are you spending most of your research efforts drilling into tech companies?

Uh, and a i companies.

And then if you I Oh, God, I hate this, but I’m gonna say Anyway, if you double click if you double click on tech, Uh, what metrics are you watching on these tech companies to that Say, you know what?

This might make a good long term opportunity for clients in State Street.

I mean, for us, uh, I mean, margin is super important and, uh, cash flow generation.

So those two characteristics are really, really important.

And once again, like like you say, tech and non tech, it’s almost kind of parallel universes.

Uh, cash flow generation is really, really fantastic.

And that makes those companies kind of immune to not immune, but more or less immune to kind of cycle fluctuation.

How strong their balance sheets are.

Are there any stocks?

Is there anything you like that is non tech?

It feels like I used to talk a lot about I used to talk a lot about industrials.

Uh, but I don’t even I don’t talk about these names anymore.

Every day it’s just meta.

I don’t know.

Yeah, no, no, no, that that’s a really good point.

And I mean, I’ve been accused of kind of hogging tech sector, talking mostly about it, but, I mean, it’s a huge part of the market.

I mean, interestingly, I mean, we will.

So So So we are concerned about kind of signs of recession and, uh, kind of potential of it, and kind of what what fed can do about it.

Story continues

So so, So company sectors with good cash flow generation is really, really important.

So maybe how care that that that that looks quite interesting.

So that’s very cash rich sector.

And, um, like big, large companies, strong balance sheets.

So So So they look interesting, like very, very tactically.

You can maybe think about, like, real estate utilities, so kind of rates and social sectors so that that that that can do better.

But generally it’s quality its size.

So, like, stylistically, those type of things that that that we like so healthcare probably kind of your defensive growth.

That looks interesting.