Although tech stocks have the most long-term growth prospects with surging demand and rising investments worldwide, certain tech stocks have reached price levels that don’t justify their current fundamentals and growth potential. Snowflake (SNOW), Cloudflare (NYSE:NET), Carvana (CVNA), and Bill.com (BILL) look way too expensive at their current price levels and could witness a pullback in the near term.Although the major stock indices shrugged off concerns over the Evergrande debt crisis, the market should remain volatile as the Fed looks to taper, case counts remain stubbornly high, and the economy is decelerating.
Along with a low-interest-rate environment, the rising demand for technology products and solutions amid ongoing digitalization and continued innovations should keep driving the sector’s growth. Tech spending in the US is expected to grow 6.7% in 2022.
However, a bullish backdrop has led to certain tech stocks reaching price levels way beyond their intrinsic values. Considering the fundamentals and growth prospects, tech stocks Snowflake Inc. (SNOW), Cloudflare, Inc. (NET), Carvana Co. (NYSE:CVNA), and Bill.com Holdings, Inc. (NYSE:BILL) look way too expensive at their current price levels. So, these stocks could witness a pullback amid the market volatility.