Exchange-traded funds (ETFs) remain an attractive investment vehicle for investors seeking attractive returns with lesser risk, as they offer diversification across several stocks, sectors, or asset classes. However, deciding which ETF to buy can be challenging. That’s where TipRanks’ ETF AI Analyst comes in!
Meet Your ETF AI Analyst
- Discover how TipRanks' ETF AI Analyst can help you make smarter investment decisions
- Explore ETFs TipRanks' users love and see what insights the ETF AI Analyst reveals about the ones you follow.
Below are three ETFs that TipRanks’ AI Analyst is bullish on. These ETFs have an Outperform rating and offer at least 10% upside. With the help of TipRanks’ ETF Comparison Tool, here’s how the three funds compare.
Technology Select Sector SPDR Fund (XLK) — The XLK ETF tracks the technology sector of the S&P 500 Index (SPX). It comprises a diversified portfolio of high-performing tech giants and emerging innovators. The XLK ETF has an expense ratio of 0.08%.
TipRanks’ AI Analyst has an Outperform rating on the XLK ETF with a price target of $327, indicating an upside potential of 13.1%. The bullish stance on the XLK ETF is based on the fund’s top holdings like tech giants Nvidia (NVDA) and Microsoft (MSFT). Both these tech companies are gaining from artificial intelligence (AI)-led tailwinds. However, the AI Analyst’s overall score for XLK ETF is tempered by weakness in stocks like Oracle (ORCL) and Palantir Technologies (PLTR), which face leverage risks or valuation concerns.
iShares Core S&P 500 ETF (IVV) — The IVV ETF tracks the S&P 500 Index, which comprises the 500 largest U.S. stocks by market capitalization. It offers investors exposure to industry-leading companies across diverse sectors, including technology, healthcare, finance, and consumer goods. IVV boasts a low expense ratio of 0.03%.
TipRanks’ AI Analyst has assigned an Outperform rating to the IVV ETF with a price target of $759, implying about 13% upside potential. The AI Analyst noted that the IVV ETF gains from solid contributions by holdings like Microsoft and Nvidia, which have strong fundamentals and attractive growth potential. However, holdings such as Berkshire Hathaway (BRK.A) (BRK.B), which have mixed technical indicators and slower revenue growth, have slightly moderated the AI Analyst’s overall score for the IVV ETF.
Financial Select Sector SPDR Fund (XLF) — The XLF ETF tracks the performance of the S&P Financial Select Sector Index. Interestingly, the XLF ETF is attractive to investors who intend to leverage the cyclical nature of financial markets or hedge against sector-specific risks. The XLF ETF has an expense ratio of 0.08%.
TipRanks’ AI Analyst has an Outperform rating on the XLF ETF with a price target of $58, indicating about 11% upside potential. While Berkshire Hathaway and JPMorgan Chase are major contributors to the ETF’s rating, the AI Analyst noted that Berkshire’s bearish momentum and lack of dividend yield modestly reduce its overall impact. Additionally, payments giant Visa (V) contributes to this ETF via its innovative digital payments solutions. However, the AI Analyst noted mixed technical signals for Visa stock.
Meanwhile, the AI Analyst points out that the XLF ETF also includes stocks like Citigroup (C) and Mastercard (MA), which face challenges such as high leverage/bearish momentum.