Fundstrat's Tom Lee said Tuesday that investors can start buying up certain beaten-down technology names that could become winners. "If an investor does their homework I do think you're going to find some real gems," Fundstrat's co-founder and head of global research told CNBC's " TechCheck ." He said certain growth names can compound their earnings expansion, and if their stocks don't have much multiple compression, "these are going to be great long-term winners." Certain technology stocks have struggled amid a rotation into value from growth sectors. The tech wreck accelerated at the start of 2022, when the Federal Reserve's hawkish pivot spurred a surge in bond yields. Rising interest rates hurt technology companies' valuations by making their future earnings less valuable. However, Lee said that many in the tech cohort had normal demand in 2021 with strong earnings and multiple expansion, but now they have broken charts. "This is probably the time you'd start to pick winners from losers," said Lee. Lee named Shopify as an example of a stock that he feels has been unreasonably punished by the sell-off in tech. The e-commerce platform is down more than 37% in 2022 and off by 50% from its all-time high in November of 2021. He said Shopify has "changed the economy" and is "part of the everyday lexicon." Lee also said the so-called FAANG (Meta, formerly Facebook, Apple, Amazon, Netflix and Google-parent Alphabet) names also look reasonable. Lee has become a closely watched strategist during the Covid crisis after issuing some timely market calls. He was also one of the few strategists on Wall Street that called the pandemic bottom and the subsequent rebound.
Tom Lee, Fundstrat Global Advisors
Scott Mlyn | CNBC
Fundstrat's Tom Lee said Tuesday that investors can start buying up certain beaten-down technology names that could become winners.