Investors looking to enjoy the rally in tech stocks may consider the Invesco QQQ Trust (NASDAQ:QQQ). So far in 2023, the QQQ ETF has advanced more than 32%, easily outperforming the 12% rise in the S&P 500 Index (SPX). Remarkably, the QQQ ETF stock has beaten the S&P 500 in nine out of the last ten years. Interestingly, analysts are optimistic about the future growth potential of this ETF, envisioning further opportunities for expansion.
The QQQ ETF tracks the NASDAQ 100 Index (NDX) and provides an opportunity to hold companies in key markets such as cloud computing, artificial intelligence, streaming services, electric vehicles, and more.
Additionally, the QQQ ETF stock has delivered an average annualized return of 17.7% in the past decade, ending in March 2023. Also, the ETF has a low expense ratio (cost of managing the ETF) of 0.20%, which makes it an attractive investment.
Is QQQ Stock a Buy?
It is worth mentioning that, as per 1,734 analysts providing ratings on QQQ’s 102 holdings, the ETF is a Moderate Buy. Its average price target of $385.11 implies a 10.4% upside. Apart from analysts’ consensus, QQQ is a Buy based on the technical indicators.
Additionally, the Invesco QQQ ETF has an Outperform Smart Score of eight on TipRanks, implying it is more likely to beat the broader market averages. It is worth highlighting that more than 50% of the holdings boast an Outperform Smart Score.
While most of the ETF’s holdings witnessed strong returns over the past year, there remain a few stars, having gained over 50%. Let’s take a look at the five best-performing stocks in the ETF:
- Nvidia Corporation (NVDA)
- Netflix Inc. (NFLX)
- Dexcom (DXCM)
- Mercadolibre, Inc. (MELI)
- Copart, Inc. (CPRT)