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- Wedbush analyst Dan Ives argued Thursday that the Nasdaq could rise to 19,000 by the end of 2022, an advance of about 20% compared to current levels.
- Speaking to CNBC, Ives acknowledged that valuations in the tech space will likely contract in 2022 as a result of tightening Federal Reserve policy. However, he said Wall Street hasn't appropriately priced in growth rates at companies like Meta (NASDAQ:FB) and Apple (NASDAQ:AAPL).
- "You're going to continue to see [earnings and revenue] numbers significantly go higher. I think the Street is underestimating growth by 12%-15%," the managing director of Wedbush Securities said.
- Ives added that two companies will likely top $3T in market cap by the end of 2022: AAPL, which is currently in striking distance of that level at $2.94T, and Microsoft (NASDAQ:MSFT), which has a little further to go with a current figure of $2.56T.
- The Wedbush analyst predicted that the megacap names would benefit from continued tech spending, as companies and individuals continue to operate their businesses and lives more on digital platforms.
- "The level of spending on the digital transformation is massive because more and more movement to the cloud," he said.
- Specifically, Ives highlighted cloud computing, cybersecurity and 5G as sector winners during the year.
- As it stands, AAPL and MSFT are the only stocks within $1T of the $3T barrier. Next on the list is GOOGL at $1.95T, followed by AMZN with $1.7T. You can compare the market caps of the world's biggest public companies on this chart.