With the summer winding down and the traditionally slow pre-Labor day lull in place, we are reviewing some of the top portfolios we follow on Wall Street for tactical changes being made to reset for the fall. Almost all the top firms we cover are tweaking portfolios for clients, and some are taking profits on stocks that have run this year.

The UBS Quality Growth at a Reasonable Price (Q-GARP) portfolio has consistently outperformed the S&P 500 since inception in 2007, and it offers investors an outstanding portfolio using an initial quantitative screen of stocks based on: 1) quality metrics—high and stable profitability, 2) growth—high expected earnings growth, and 3) valuation— low valuation relative to peers. The final list is a compilation of quality growth stocks that the firm believes are trading at attractive valuations.

The UBS portfolio team removed a big tech stock from the portfolio, and we here also look at the top technology stocks that remain.

Cognizant Technology

This top stock is removed from the portfolio and also taken off the UBS Most Preferred List. Cognizant Technology Solutions Corp. (NASDAQ: CTSH) provides information technology (IT), consulting and business process services worldwide. Its services include IT strategy consulting, program management consulting, operations improvement consulting, strategy consulting and business consulting services, as well as application design and development, systems integration, enterprise resource planning and customer relationship management implementation services.

The UBS team is worried about competition and sector issues in the company’s space, and said this in its report:

In our view, the short- and longer-term growth outlook for Cognizant is becoming less certain. Companies in the financial services industry account for 40% of Cognizant revenues. Unfortunately, this industry is contending with a number of issues that are hurting sector profitability, such as low (and in many cases negative) interest rates and sluggish client activity.

The Wall Street consensus price target for the stock is $67.88. Shares closed Wednesday at $57.44.

Adobe Systems

This high-profile old-school software company has been posting outstanding earnings. Adobe Systems Inc. (NASDAQ: ADBE) operates in three segments. The Digital Media segment provides tools and solutions that enable individuals, small and medium businesses, and enterprises to create, publish, promote and monetize their digital content.

The Digital Marketing segment offers solutions for how digital advertising and marketing are created, managed, executed, measured and optimized. This segment provides analytics, social marketing, targeting, media optimization, digital experience management and cross-channel campaign management solutions, as well as video delivery and monetization to digital marketers, advertisers, publishers, merchandisers, Web analysts, chief marketing officers, chief information officers and chief revenue officers.

The Print and Publishing segment offers products and services, such as eLearning solutions, technical document publishing, Web application development and high-end printing, as well as publishing needs of technical and business and original equipment manufacturers (OEMs) printing businesses.

Adobe is also reasonably safe route for investors looking to own a company with Marketing Automation product, which has become huge.

The UBS price target is $122, and the target is $112.46 Shares closed on Wednesday at $102.31.
Alphabet

The search giant continues to expand and is even working on a driverless car now. Alphabet Inc. (NASDAQ: GOOGL) provides online advertising services in the United States, the United Kingdom and rest of the world. It offers performance and brand advertising services, and it operates through Google and Other Bets segments. The Google segment includes principal internet products, such as Search, Ads, Commerce, Maps, YouTube, Apps, Cloud, Android, Chrome and Google Play, as well as technical infrastructure and newer efforts, such as virtual reality.

The Google segment also sells hardware products, comprising Chromecast, Chromebooks and Nexus. The Other Bets segment includes businesses such as Access/Google Fiber, Calico, Nest, Verily, GV, Google Capital, X and other initiatives.

The company has an impressive market capitalization of $532.4 billion. The consensus price target is posted at $940.91. The shares closed the day on Wednesday at $789.85.

Facebook

The huge social media leader posted gigantic quarterly numbers that truly blew most of Wall Street away. Facebook Inc. (NASDAQ: FB) operates as a mobile application and website that enables people to connect, share, discover and communicate each other on mobile devices and personal computers worldwide.

Its solutions also include Instagram, a mobile application that enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends; Messenger, a messaging application for mobile and web on various platforms and devices, which enable people to reach others instantly, as well as enable businesses to engage with customers; and WhatsApp Messenger, a mobile messaging application.

Facebook also develops Oculus virtual reality technology and content platform, which allows people to enter an immersive and interactive environment to play games, consume content and connect with others. As of December 31, 2015, it had 1.04 billion daily active users (DAUs) and 934 million DAUs who accessed Facebook from a mobile device. Most Wall Street analysts point to the fact that Facebook remains the top beneficiary of the adoption of mobile internet trends with total U.S. internet time spent on Facebook and Messenger.

Facebook has grown to an astounding $360.1 billion market cap in less than five years. The UBS price objective is $155, and the consensus target is $153.71. Shares closed Wednesday at $126.12.

Red Hat

This top technology stock is the last of the pure tech names in the Q-GARP portfolio. Red Hat Inc. (NYSE: RHT) is the world’s leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training and consulting services.

Last year the company formed a partnership with once bitter rival Microsoft that would bring more flexibility to hybrid cloud enterprise environments. Specifically, the partnership allows cloud products running under the Linux operating system to integrate with Microsoft’s cloud computing platform Azure, a huge move after years of competition.

The $85 UBS price target compares to the slightly higher consensus target of $87.71. The stock closed the day Wednesday at $72.98.

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The technology stocks that land in the Q-GARP portfolio generally make sense for growth stock portfolios, as they are all leaders in their segments and not wildly overbought and priced.

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