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iShares Expanded Tech Sector ETF offers broader tech exposure with lower valuation than XLK, expected to outperform.

Analyst Insights
05 Aug 2026
Seeking Alpha
View Source
Bullish
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The iShares Expanded Tech Sector ETF (IGM) provides wider tech sector exposure than the traditional XLK ETF, including communications, consumer discretionary, and non-S&P 500 North American firms. This broader mandate results in a lower forward price-to-earnings ratio (20.3x) compared to XLK, alongside strong forward earnings growth of 29.5%. Key tech giants like Alphabet, Meta, and Netflix are excluded from XLK but included in IGM, which helps explain IGM's lower valuation and diversified holdings. Both ETFs are rated as buys, but IGM is expected to outperform due to its unique sector mix and inclusion of peripheral tech companies, making it attractive for fresh tech investments.

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