Raymond James chief market strategist Matt Orton says the latest bout of selling is less collapse than an opportunity.
In a new CNBC interview, Orton is urging investors to treat volatility as a headfake in an ongoing bull market.
“I think this rotation that we’re starting to see is probably another head fake,” Orton says, pointing to durable growth themes tied to artificial intelligence and related sectors. “It doesn’t mean that breadth and balance in portfolios isn’t working because it absolutely is.”
Orton describes signs of exhaustion in some of the most crowded trades, citing CoreWeave’s disappointing earnings as an early spark for profit taking heading into the Labor Day lull. But he cast the pullback as a seasonally weak stretch that investors should exploit.
“A lot of investors have been waiting for an opportunity to redeploy some capital into these names,” he says. “So I encourage all of our clients to really use this downside opportunistically to lean into those higher quality, strong, secular growth names that are going to be durable going forward because these mega caps have a ton of cash.”
He singles out Alphabet as the standout candidate.
“And so a mega cap that looks incredibly attractive right now is Alphabet,” Orton says. “Here’s a name that’s valued less than the S&P 500 with tremendous top and bottom line growth, a rock solid balance sheet, and a lot of different growth drivers, not just in artificial intelligence, but in traditional search.”
Quarter after quarter, analysts predict Google’s core engine will be displaced by AI rivals. Orton waves off the claim.
“It hasn’t happened yet, and I don’t think it’s going to happen. So this pullback makes it an even more attractive opportunity to get into a strong name like Alphabet going forward.”
Raymond James Investment Management oversees about $76.6 billion in assets and is headquartered in St. Petersburg, Florida.
