Technology investments to buy after a pullback are giving investors a new opportunity to enter promising positions at reduced prices.
Whether the market is finished pushing down the valuation of top technology stocks is unclear, but a significant share-price retreat now provides a tempting time to purchase high-potential equities. Investors can choose either funds or stocks to tap into what could turn into a technology recovery.
Markets have been quite volatile recently, with selling taking place early last week among many equities that had been on the rise due to artificial intelligence (AI) applications. Particular focus has been placed by investors lately on software companies that have lost luster.
However, markets have achieved bounce-back days, too, as traders took a look at the “oversold landscape” and realized that there were now a lot of attractive buying opportunities out there, wrote Jim Woods to subscribers of his Tactical Trader advisory service.
“The volatile action last week was actually quite good for our Tactical Trader portfolio, as many of our holdings vaulted higher on strong buying,” Woods wrote in his Tuesday, Feb. 10, update for his followers. “Several positions here were particularly strong.”
Jim Woods heads the Tactical Trader service.
Technology Investments to Buy After a Pullback: IWM
One of them is an exchange-traded fund (ETF), iShares Russell 2000 ETF (NYSE ARCA: IWM), designed to track the investment results of an index composed of small-capitalization U.S. equities. The iShares Russell 2000 ETF technically only has 1,946 holdings and averages a 30-day trailing dividend yield of 0.98%.
IWM slipped 0.27% on Tuesday, Feb. 10, but it has climbed 6.65% since it was recommended in Tactical Trader on December 16, 2025. The historical performance of the fund is IWM has been good during the past few years.
Its total return grew 12.69% during the past year and averaged 13.59% annually for the past three years. Less impressive was a total return that averaged 5.96% during the past five years and 9.54% for the last 10 years.
The fund’s year-to-date total return, including dividends, is 1.91% as of the close on trading on Feb. 10.
Even though IWM tracks U.S. small-cap stocks, it does not have huge exposure to the technology sector, unlike the iShares Russell 1000 ETF (IWB). As of early 2026, information technology accounted for 14.13% of the IWM’s holdings, behind industrials, 19.18%, financials, 17.37%, and health care, 17.04%. The fund’s management fee as an index fund is a modest 0.19%.
Chart courtesy of www.stockcharts.com.
Technology Investments to Buy After a Pullback: PLTR
One of the best-performing stocks in the past year is Palantir (NASDAQ: PLTR), a defense and cybersecurity company. The Forecasts & Strategies investment newsletter led by Woods recently combined what he regarded as the top recommendations in that publication and the Investing Edge newsletter that he previously headed before they merged together under on name at the start of February.
Palantir has soared 104.65% since Woods recommended it on January 15, 2025. Woods, a former Army paratrooper who expressed praise for the company’s defense capabilities and related cybersecurity capabilities.
Technology Investments to Buy After a Pullback: Perry Picks Palantir
Another fan of Palantir is Bryan Perry, who recommends it in his Hi-Tech Trader advisory service. Perry recommends both stocks and related call options in that service.
Bryan Perry heads Hi-Tech Trader and Cash Machine.
Louie DiPalma, an aerospace and defense analyst with Chicago-based William Blair & Co, recently upgraded Palantir to an “outperform” rating after its shares pulled back 30%. DiPalma uses both a proprietary Dotted Line government tracker and a separate commercial tracker that indicate Palantir’s momentum on resuming.
“The new administration continues to go all-in with Palantir and enterprises are adding workflows, which contributed to an astounding Rule-of-114 September quarter, and likely a very strong December quarter,” DiPalma wrote in a recent research note. “Although Palantir’s valuation is still frothy, it appears more reasonable relative to recent venture rounds for companies tied to the AI ecosystem.”
Despite the momentum, DiPalma added that Palantir shares have not been immune to the broader software “vibe coding selloff.” While the earnings-day reaction will surely be volatile, we are expecting a positive move based on our Dotted Line tracker, he added.
Chart courtesy of www.stockcharts.com.
Technology Investments to Buy After a Pullback: AVAV
AeroVironment Inc. (NASDAQ: AVAV), an Arlington, Virginia-based provider of intelligent, multi-domain robotic systems that include unmanned aerial vehicles (UAVs), has endured a share-price drop lately that included a 15.77% fall on Tuesday, Jan. 20. But Chicago-based William Blair & Co. equity research analyst Louie DiPalma recently issued a new research report on AeroVironment with an “outperform” rating.
The defense technology company delivers integrated capabilities across air, land, sea, space and cyber that remain in demand. In a perfect world, the share prices of stock would not take big hits, but that is not the market climate that exists today.
Shares of AeroVironment gave back some of their recent gains since Uvision announced that its HERO-90 loitering missile system was selected for the U.S. Army’s LASSO program. In addition, AVAV indicated days later that the U.S. Space Force issued a stop order for the company’s $1.7 billion SCAR contract to shift the contract from cost-plus to fixed-price, he added.
“In our view, the U.S. Army in the first half of this year will announce that AVAV was also selected for LASSO,” DiPalma wrote. “Further, we estimate that the SCAR program should resume over the next few months after the contract is renegotiated for fixed-priced terms. However, the SCAR contract pause and LASSO delays may pressure near-term revenue. Based on company disclosures, we estimate that SCAR contributes approximately $150 million in annual revenue.”
Chart courtesy of www.stockcharts.com.
Technology Investments to Buy After a Pullback: Geopolitical Risk
Geopolitical risk remains a factor for investors to weigh. At least with stocks involved in the defense-related technology industry, their businesses can benefit from increased military spending.
Russia’s continuing invasion of neighboring Ukraine and the refusal of the aggressor’s President Vladimir Putin to thus far accept peace proposals from President Trump that would benefit the country and its people economically has continued to add to an already high death count. Russia particularly has caused deaths and serious injuries to civilians who have included women and children.
With software and other technology stocks losing luster with investors lately, defense and cybersecurity companies contractors may gain enhanced investor interest. The needs of governments around the world to protect the freedom of their nations only appear to be rising.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. Follow Paul on Twitter @PaulDykewicz.
