At first glance, the concept of tech stocks to buy might seem exceptionally risky at this juncture. After all, the market continues to digest the bank runs and failures of two major financial institutions. In addition, much anxiety centers on the Federal Reserve’s next move. Whatever direction it chooses regarding interest rates, the equities sector may suffer volatility.
Still, one fundamental factor undergirds the broader storyline of all tech stocks to buy. No matter what’s going on with the economy, the human drive to go further than prior generations undergirds innovation. Of course, that’s not to say that all technology-oriented firms will succeed – far from it. However, the perpetual economic motivation to advance instills broader permanent relevance in the industry.
Beyond that, tech stocks to buy present great deals. Thanks to the market volatility, several compelling enterprises now feature tempting discounts. If you have an adventurous spirit, these are the companies to consider if you’re holding for the next decade.
Based in Israel, Cellebrite (NASDAQ:CLBT) specializes in modernizing its clients’ investigative workflow with an industry-leading digital intelligence platform. According to its website, Cellebrite offers solutions for state and local government agencies, criminal investigations, border security, environmental crimes, and private enterprises. Although not well known, those in the know love the idea, making it one of the tech stocks to buy.
Since the start of the new year, CLBT has gained almost 28% of its equity value. However, it’s still relatively discounted, with shares down more than 8% in the trailing year. Further, on the financial front, it offers some attractive attributes. First, it benefits from a decently stable balance sheet, particularly with a strong cash-to-debt ratio of 12 times.
Second, it enjoys robust operational stats. Its three-year revenue growth rate is 14.7%, outpacing 66.77% of the industry. Also, its EBITDA growth rate during the same period comes in at 54.9%, beating out nearly 91% of sector players.
Finally, Wall Street analysts peg CLBT as a consensus moderate buy. Their average price target is $6.17, implying a 7% upside potential.
Kulicke and Soffa Industries (KLIC)
Based in Singapore, Kulicke and Soffa Industries (NASDAQ:KLIC) really doesn’t generate many eyeballs outside of hardcore fans of tech stocks to buy. Fundamentally, that makes KLIC one of the underrated narratives in the equities space. According to its website, Kulicke is a leading provider of semiconductor, LED, and electronic assembly solutions serving the global tech ecosystem.
Since the start of the year, KLIC has gained nearly 21% of its equity value. However, in the past 365 days, it shed almost 13%. This crimson stain offers contrarians an enticing opportunity among tech stocks to buy. Frankly, Kulicke features various strengths across the board. Perhaps most importantly, the enterprise commands a cash-rich balance sheet at this juncture.
Operationally, the company posted a three-year revenue growth rate of 44.2%, outboxing 94.2% of the field. Also, its net margin is 25.8%, above 87.11% of sector peers. The market prices KLIC at a trailing multiple of 9.98. Kulicke ranks better than 71.39% of the semiconductor industry as a discount to earnings.
Lastly, covering analysts peg KLIC as a consensus moderate buy. Their average price target stands at $62.50, implying over 20% upside potential.
Daqo New Energy (DQ)
Based in China, Daqo New Energy (NYSE:DQ) engages in the manufacture of monocrystalline silicon and polysilicon, primarily for use in solar photovoltaic systems. With the political and ideological winds pushing the global communities to adopt renewable energy infrastructures, Daqo theoretically benefits from a large total addressable market. On that basis alone, DQ might attract speculators of tech stocks to buy.
Interestingly, some solar energy firms fell because of their exposure to recently failed financial institutions. However, Daqo went completely against the grain. Since the January opener, DQ has gained over 23% of market value. Also, in the trailing year, it moved up to over 14%. Financially, the company enjoys several significant strengths. At this juncture, its no-debt balance sheet will likely attract interest.
Also, it’s a very profitable enterprise. Right now, its net margin is 40.36%, above nearly 97% of the industry. The market also prices DQ at a trailing sales multiple of 0.87. Daqo ranks better than 83.32% of the competition as a discount to revenue.
Notably, JPMorgan Chase’s Alan Hon pegs DQ as a buy. Further, the expert’s price target stands at $61, implying nearly 24% upside potential.
Super Micro Computer (SMCI)
Headquartered in San Jose, California, Super Micro Computer (NASDAQ:SMCI) is an information technology (IT) firm. Specifically, Super Micro provides high-performance and high-efficiency servers, server management software, and storage systems for various markets, including enterprise data centers, cloud computing, artificial intelligence, 5G, and edge computing.
Given its myriad relevancies for several burgeoning markets, SMCI justifies its inclusion on this list of tech stocks to buy. As well, SMCI represents a strong performer. Since the January opener, shares have gained over 9% of equity value. In the past 365 days, they’re up nearly 115%, a remarkable figure.
Financially, Super Micro also enjoys several attractive metrics. First, its Altman Z-Score is 6.55, implying low bankruptcy risk. Operationally, its three-year revenue growth rate of 12.7% beats out 73.75% of the competition. In terms of value, SMCI’s price-earnings-growth (PEG) ratio is 0.42 times. In contrast, the sector median value is 1.17 times.
Turning to Wall Street, analysts peg SMCI as a moderate buy. However, there’s nothing moderate about the average price targe of $122, which implies nearly 33% upside potential.
The Hackett Group (HCKT)
Headquartered in Miami, Florida, The Hackett Group (NASDAQ:HKCT) loves its word salad. Citing processes, connectivity and acceleration, it’s difficult to grasp the most basic concept: what the company actually does. Fortunately, Hackett provided a succinct answer in one of its press releases: it’s a leading benchmarking, research advisory, and strategic consultancy firm.
Aside from obfuscating its business to prospective investors, HCKT offers a compelling idea for tech stocks to buy. Notably, Gurufocus.com identifies five good signs with the enterprise, with no yellow nor red flags. Undergirding the consultancy firm is a solid balance sheet with an Altman Z-Score of 5.35, reflective of low bankruptcy risk.
Operationally, Hackett posted a three-year EBITDA growth rate of 18.8%, above 62% of its rivals. Its net margin is nearly 14%, above 84.74% of the underlying category. As well, the market prices HCKT at a trailing multiple of 13.84. Hackett ranks better than nearly 77% of the competition as a discount to earnings.
Looking to the Street, covering analysts peg HCKT as a consensus moderate buy. Moreover, their average price target is $24.50, implying over 38% upside potential.
Immersion Corp (IMMR)
A developer and licensor of touch feedback technology, Immersion Corp (NASDAQ:IMMR) features natural relevancies for the video gaming industry as well as virtual reality applications. As well, Immersion is moving into the automotive space, which could be an intriguing opportunity for investors of tech stocks to buy. To be fair, though, some critics accuse Immersion of being a patent troll, per Bloomberg Law.
Setting that issue aside, IMMR appears rather compelling from a financial perspective. Perhaps most noticeably, Immersion commands a very robust balance sheet. Its cash-to-debt ratio is 308.1 times, outpacing 84.34% of its peers. Also, its net margin is nearly 80%, a remarkably high figure.
Better yet, the market prices IMMR at a forward multiple of 10.77. As a discount to earnings, Immersion ranks better than 87.82% of the industry.
Finally, BWS Financial’s Hamed Khorsand pegs IMMR as a buy. In addition, the expert’s price target stands at $11, implying over 41% upside potential.
Silicon Motion Technology (SIMO)
An American-Taiwanese company, Silicon Motion Technology (NASDAQ:SIMO), develops NAND flash controller integrated circuits for solid-state storage devices. According to the company, between 2006 through 2016, Silicon Motion supplied more NAND flash controllers than any other enterprise. As one of the lesser-known tech stocks to buy, it’s not quite dazzling in the charts. In the trailing year, SIMO dipped 14%.
However, Silicon Motion offers several attractive attributes in its books. For starters, the company carries zero debt. With concerns rising about recessionary (i.e., deflationary) headwinds, having a strong cash balance commands a premium. Also, its Altman Z-Score pings at 7.64, indicating strong stability.
Further, it offers an attractive value proposition. Currently, the market prices SIMO at a forward multiple of 13.24. As a discount to earnings, the company ranks better than 74.82% of the semiconductor industry.
Lastly, covering analysts peg SIMO as a unanimous strong buy. In addition, their average price target is $91, implying a nearly 53% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.