What are we looking for?
Stocks that stand out as compelling candidates for investors anticipating a tech rebound.
The U.S. technology sector has struggled in 2025, with the SPDR Select Technology Sector ETF (XLK) relatively flat, making it the worst performing sector so far. However, our analysis using Trading Central’s Quantamental Factor Investing methodology reveals a set of tech stocks exhibiting strong earnings growth, revenue expansion and price momentum, factors that historically delivered strong five-year back-tested returns.
With the U.S. technology sector at a potential turning point, these stocks stand out among others in the sector. Most of the stocks mentioned below are already in a strong upward price trend.
The screen
Using Trading Central’s Strategy Builder, we scanned for U.S.-listed technology stocks that exhibit strong earnings growth, upward price momentum and high TC Quantamental factor ratings, specifically targeting stocks with strong growth and momentum factor scores.
Our selection process followed three key criteria:
1. Market capitalization: We set a minimum market cap threshold of US$5-billion, focusing on mid- to large-cap stocks to avoid smaller, more volatile names.
2. Earnings growth and momentum: We screened for companies demonstrating upside earnings momentum, requiring EPS and revenue growth of at least 10 per cent last quarter compared to the same period a year ago.
3. TC Quantamental Factor ratings: Using Trading Central’s proprietary Quantamental rating system (which scores stocks from 0 to 100, with 100 being the most bullish), we filtered for stocks scoring at least 50 in both growth and momentum factors, ensuring a focus on companies with strong fundamental and price trends.
For informational purposes, we’ve also included each stock’s recent price, year-to-date and one-year price performance.
More about Trading Central
Trading Central is a global leader in financial market research and investment analytics for retail online brokers and institutions. Its product suite provides actionable trading ideas based on technical and fundamental research covering stocks, exchange-traded funds, indexes, forex, options and commodities. Strategy Builder, our stock screener is available through leading retail brokers in Canada and worldwide.
What we found
Stocks are ranked based on the average of all screening criteria selected.
AppLovin Corp. APP-Q, a mobile technology company that provides software solutions for app developers to optimize user acquisition and monetization, tops our list. With a TC Momentum Factor Rating of 95 and a Growth Factor Rating of 89, AppLovin demonstrates robust financial and price performance, posting 38.64-per-cent revenue growth and an impressive 316.67-per-cent EPS growth last quarter. The stock price has gained an impressive 672 per cent over one year.
Palantir Technologies Inc. PLTR-Q, a data analytics and artificial-intelligence company that specializes in providing software solutions for government agencies and enterprises, stands out as another noteworthy stock on the list based on its strong combination of growth, momentum and market performance. The company has a TC Momentum Factor Rating of 96, the highest on our list. Its revenue growth of 29.98 per cent and EPS growth of 100 per cent last quarter highlight its solid financial performance. Additionally, Palantir has gained 34.8 per cent year-to-date and an impressive 329.5 per cent over the past year, making it one of the best-performing stocks on the list. The stock posted another record-high this week.
Duolingo Inc. DUOL-Q, a language-learning platform that uses artificial intelligence and gamification to engage users in personalized education, is another standout stock on the list, driven by strong earnings growth and solid momentum. The company has a TC Growth Factor Rating of 91 and a TC Momentum Factor Rating of 81, indicating a favourable balance of fundamental strength and price performance. In the latest quarter, Duolingo reported 39.94-per-cent revenue growth and an impressive 716.67-per-cent EPS growth last quarter. The stock achieved a new record-high price on Feb 5.
Trading Central Strategy Builder provides a back-testing capability to evaluate how well an investing strategy would have worked in the past. Using a five-year historical period with quarterly rebalancing, the screen described had an impressive 44-per-cent annualized total return compared with 14 per cent for the Nasdaq Composite Index.
The investment ideas presented here are for information only. They do not constitute advice or a recommendation by Trading Central in respect of the investment in financial instruments. Investors should conduct further research before investing.
Gary Christie is head of North American research at Trading Central in Ottawa.