Why this analyst likes Facebook's status
The technology-laced Nasdaq (NASDAQ: .IXIC)'s out-performance of the S&P 500 (INDEX: .SPX) Index may have some thinking that tech is expensive. However, one top technician says there are still gains to come, and he's identified two names that look like they could be ready to breakout in the second half.
Strategas Research Partners' Chris Verrone told CNBC's "Fast Money" last week that Facebook (NASDAQ: FB) and Adobe (NASDAQ: ADBE) are looking attractive from a technical perspective, and he would look to add to those two names on any pullback.
"In sideways markets we want to own leadership," said Verrone, who notes the relative strength of the social network and the software company. The shares of both have managed to trade above their 200-day moving averages the last two years, which Verrone said was a sign of long-term strength heading into the back half.
"Broadly, the technology sector is starting to look washed out, and Facebook and Adobe are likely bounce candidates as we move through the summer," he said.
"Both names are in established up trends, are established leaders, recently broke out, and are now back to good support," Verrone added. "We suspect both names are within a few percentage points of marking a good entry."
Facebook recently broke above $86 a share, a key level that Verrone thinks will take the stock 16 percent higher to $100.
As for Adobe, the tech giant recently broke above $80, a ceiling the stock has tested since March.
But neither of these stocks struck the interest of "Fast Money" trader Brian Kelly, who says Microsoft (NASDAQ: MSFT) offers the most attractive dividend for its relatively cheap price.
Microsoft shares have traded in a range between $44 and $46 for the last week, a 5 percent discount to where the stock was trading in January.
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