The technology-heavy Nasdaq jumped to yet another new record on Thursday, on the back of strong gains from Apple AAPL, Amazon AMZN, and other giants. The broader market positivity comes as Wall Street celebrates the possibility of more government spending on coronavirus relief under the Biden administration.
All three major U.S. indexes did slip slightly through early afternoon trading Friday, yet they rest within striking distance of their all-time highs. The S&P 500 is currently up around 3.8% since the start of January trading and nearly 18% since the end of October.
Along with further stimulus hope, some of the big banks and other early earnings results have come in strong. The overall fourth quarter outlook has continued to improve and S&P 500 earnings are projected to surge back in 2021. Investors should note that Microsoft MSFT, Apple, Facebook FB, Tesla TSLA, and countless other heavy hitters are all projected to report their quarterly results next week (also read: Early Q4 Results Show an Improving Earnings Picture).
Investors also continue to appear bullish as they bet that the vaccine will help things return to something closer to normal later this year. So now might be a good time to consider some highly-ranked, high-flying stocks that fit within the broader technology basket.
TechTarget, Inc. TTGT
TechTarget is an intent-driven digital marketing and sales services firm that works within the enterprise technology sphere. TTGT creates an array of editorial content for its clients to help potential consumers find their companies and offering in our crowded online world. TechTarget stock has soared 175% in the past year and it has expanded its reach through acquisitions recently.
The company closed its deal to buy BrightTALK in late December, which added “a leading marketing platform for webinars and virtual events in the enterprise IT market” to its portfolio. TTGT then announced in early January its purchase of The Enterprise Strategy Group.
The first-party purchase intent data firm is projected to see its FY20 revenue climb over 8%, based on our Zacks estimates. This would follow 10% top-line expansion in FY19 and 12% in 2018. TechTarget’s fiscal 2021 revenue is then projected to soar 46% to $212 million, with its adjusted earnings expected to surge by 19% and 35%, respectively during this stretch. The company stands to benefit as companies search for ways to improve their tech infrastructure.
TTGT has beat our earnings estimates in the trailing two periods and its overall bottom-line outlook has improved significantly to help it land a Zacks Rank #1 (Strong Buy) at the moment. TechTarget also grabs a “B” grade for Growth in our Style Scores system and it sits right near its new highs at $72 a share.
The stock is up 50% in the last three months and 375% in the last three years. And despite trading near new records, its valuation marks a 15% discount compared to its own year-long highs in terms of forward sales.
Micron is one of the largest makers of DRAM and NAND memory chips in the world and it has made an impressive comeback within the cyclical space over the past six months. The memory chip firm returned to growth in Q3, with sales up 14% and fourth quarter revenue up 24%.
The Boise, Idaho-headquartered company then beat our Q1 FY21 estimates on January 7 and also provided strong guidance. MU stands to benefit from strong demand from 5G, cloud computing, automotive, and elsewhere this year and beyond.
Zacks estimate calls for MU’s FY21 revenue to jump 16%, with FY22 projected to climb over 25% higher to $31.1 billion. Better still, MU’s adjusted earnings are projected to surge by 36% this year and a whopping 98% in fiscal 2022. Clearly, Micron’s growth momentum is set to return and analysts have raced to up their bottom-line estimates to help it grab a Zacks Rank #1 (Strong Buy) right now.
Micron stock is up over 55% in the past three months after it began to break out of a rough stretch in August of 2020. MU shares are now up 688% over the last five years to more than double the semiconductor industry’s average and it might be poised to keep on climbing.
Micron’s run has stretched its valuation to its highest levels in years. That said, given the memory space’s commodity-like standing within chips, it still trades at a big discount to its industry overall. And 14 of the 21 brokerage recommendations that Zacks has for Micron come in a “Strong Buy” with three more at a “Buy.”
SolarEdge has benefitted from the Biden victory as Wall Street bets on an increased push toward renewable energy. The company might not be a traditional “tech” stock. Yet its inverters convert the DC power that photovoltaic solar panels produce into the AC power used in our homes and businesses.
The company’s offerings aim to “maximize power generation at the individual PV module-level while lowering the cost of energy produced by the solar PV system” and are poised to remain a vital part of the solar energy industry for years.
The Fremont, California-based firm aims to be the “leading provider of inverter solutions across all PV market segments” and it competes in a similar space to fellow high-flyer Enphase ENPH. Like many of its peers, SEDG stock has dipped after the massive Biden/Democratic-based run, down around 15% from early January highs. Despite the pullback, which might make it more attractive, the stock has soared 190% in the last 12 months.
SolarEdge, which aims to help speed up the transition to a modern, futuristic power grid, has seen its sales climb from under $500 million in 2016 to $1.4 billion in FY19. Zacks estimates call for its FY20 sales to climb slightly in 2020, dragged down by rough conditions for the overall energy sector.
Peeking ahead, its FY21 revenue is projected to jump 19% hit $1.7 billion, with its adjusted EPS figure set to climb 14%. The stock has crushed our EPS estimates in three out of the last four quarters and its improving earning revision help it land a Zacks Rank #1 (Strong Buy). SolarEdge also sports an “A” grade for Momentum and its Solar space rests in the top 30% of our over 250 Zacks industries.
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Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Micron Technology, Inc. (MU) : Free Stock Analysis Report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Tesla, Inc. (TSLA) : Free Stock Analysis Report Enphase Energy, Inc. (ENPH) : Free Stock Analysis Report Facebook, Inc. (FB) : Free Stock Analysis Report SolarEdge Technologies, Inc. (SEDG) : Free Stock Analysis Report TechTarget, Inc. (TTGT) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research