Even the finest tech stocks have had a rough month in December. Despite this, the Nasdaq-100 market, which is heavily weighted in technology, has profited approximately 20% so far in 2021. Investors are now wondering what the future holds for these high-growth stocks in the coming year.
Gains have not been evenly spread during the last 12 months. Although the index’s performance has been dominated by mega-tech stocks, several widely-followed technology names have seen their stock prices plummet.
Consumer electronics, cybersecurity, and cleantech stocks, notably, have seen huge fluctuations. Profit-taking, rising inflation, supply-chain difficulties, and the advent of the omicron variety are all factors that have contributed to the latest unpredictability.
Nonetheless, these reductions provide reasonable starting prices for numerous growth stocks that are expected to report good financial results in the coming quarters. Such equities are excellent buys, especially if investors can find ones with strong fundamentals, affordable values, and the potential to profit from their momentum and development.
With that knowledge, here are three of the greatest tech stocks that are poised to deliver long-term shareholder value:
1. Ambarella (AMBA)
$82.59 – $227.59 is the 52-week range.
Ambarella specializes in high-definition (HD) video capture, sharing, and display semiconductor processing solutions. Ambarella’s devices are used in a variety of applications, including artificial intelligence (AI), computer vision, security, and driver-assistance cameras.
Late in November, Ambarella released their Q3 FY22 results. Year-over-year (YOY) revenue climbed by 64% to $92.2 million. Non-GAAP net income increased to $22.2 million, or 57 cents per diluted share, compared to $3.3 million, or 9 cents per diluted share, in the previous quarter.
Cash and equivalents were $458 million at the end of the quarter. Additionally, management raised revenue expectations for the fourth quarter by 45 percent year over year to $90 million.
Chips used in cameras used in the automotive industry as well as security applications are in high demand, according to the business. The stock of AMBA is hovering above $195 per share, up over 115 percent year to date (YTD).
The stock is currently selling at a forward earnings multiple of 119 and a trailing sales multiple of 21.4. Savvy individuals may find higher deals around $170, however Ambarella stock has a 12-month consensus price projection of $227.
2. Ciena (CIEN)
$47.52 – $75.45 is the 52-week range.
Ciena makes network gear and software that allows video, phone, and data traffic to be delivered through communications networks.
Ciena’s goods and solutions have been in high demand due to 5G networks and data centers, according to experts.
On December 9, management released positive fourth-quarter results. Revenue grew by 26% year over year to $1.04 billion. Adjusted net income increased 42 percent year over year to $132.7 million, or 85 cents per diluted share, from $94.5 million, or 60 cents per diluted share, in the previous quarter. Cash and equivalents totaled $1.4 billion at the end of the quarter.
Samsung Electronics (OTCMKTS: SSNLF) has recently teamed with Ciena to facilitate its 5G implementation. Telecom operators should be able to better handle the growth in 5G data volumes as a result of this agreement.
CIEN stock is a good pick for investors intending to acquire a 5G stock because it is fairly priced. The stock of CIEN is hovering at $75, up 47 percent year to date. Just 21.7 times forward earnings and 3.2 times trailing sales are being paid for the stock. Ciena stock has a 12-month median price projection of $83.
3. Dell Technologies (DELL)
The 52-week range is $35.56 – $59.49.
Dell Technologies is a popular firm in the field of information technology (IT) that primarily operates in two components. The Client Solutions Group supplies hardware and peripherals as well as IT solutions. Software, storage, and server solutions are all available through the Infrastructure Solutions Group.
In late November, the business released strong Q3 FY22 earnings. It brought in an unprecedented $28.4 billion in revenue, up 21% year on year. Non-GAAP net income was $2 billion, or $2.37 per diluted share, compared to $1.7 billion, or $2.03 per diluted share, in the previous quarter. Cash and equivalents were $23.4 billion at the end of the quarter.
Dell’s 81 percent ownership in VMware was spun off on November 1st (NYSE: VMW). The corporation will be capable of reducing debt and paying dividends and share buybacks as a result of the action.
DELL is still trading at a reasonable value in comparison to its peers, despite generating its best third-quarter profits in history. The stock is currently hovering at $55, representing a 96 percent year-to-date gain.
At 6.6 times forward profits and 0.4 times trailing sales, the stock appears to be more of a value stock. Dell’s stock has a 12-month median price expectation of $65.
Disclaimer: The author has no explicit or implicit holdings in the securities referenced in this article as of the publication date. The writer’s views are expressed in this article, which is subject to the Zumm.org Publishing Guidelines.