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5 Top-Ranked Technology Stocks From Top Industries in 2019

Radhika Pujara

The technology sector has been combating deterrents like the U.S.-China trade dispute, Brexit impasse and other geopolitical concerns through 2019.

Nevertheless, robust adoption of cloud computing solutions amid ongoing digital transformation of enterprises, backed by growing integration of AI and ML technologies, has been driving the technology stocks.

Further, continuous innovation in electronic devices and major breakthrough developments has led to solid adoption of wearables and smart-connectivity solutions, including smart speakers and virtual reality/ augmented reality (VR/AR) devices.

Additionally, technical advancement in the telecommunication sector on accelerated deployment of 5G technology and strong efforts toward modification in Internet infrastructure have been acting as tailwinds.

Notably, semiconductor sales have improved sequentially in August, September and October, indicating a recovery in the chip market. Moreover, PC shipments have improved in the second and third quarter of 2019.

Tech Stocks Poised to Usher in a Promising 2020

Per World Semiconductor Trade Statistics, global semiconductor sales are expected to increase 5.9% in 2020 against an estimated decline of 12.8% in 2019.

Moreover, demand for memory chips is likely to keep rising in 2020, primarily driven by datacenter customers. Also, the excess NAND and DRAM inventory, which had limited growth for the most part of 2019, is expected to normalize, thereby improving average selling price.

Further, per the recent phase one deal, the U.S. government has agreed to suspend tariffs on Chinese goods worth $160 billion, which included cell phones, laptop computers, toys and clothing. This is expected to aid the tech stocks commence 2020 on an encouraging note.

Additionally, the technology companies are anticipated to benefit from recovering IT-spending trends in 2020.

Top Tech Stocks from Top Performing Industries

Given the optimism surrounding tech stocks it is obvious that stocks from top-ranked industries within the Zacks Computer and Technology sector will perform significantly better.

Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1.

Markedly, the Zacks Computer and Technology sector has gained 35.6% in the past year, outperforming the S&P 500 composite’s rally of 30.8%.

We have employed the Zacks Stocks Screener to find five technology stocks from top-ranked industries. These stocks sport a Zacks Rank #1 (Strong Buy) which makes them solid investment opportunities. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our Picks

Tokyo, Japan-based multinational photography and imaging company FUJIFILM Holdings FUJIY belongs to the Semiconductor Equipment - Photomasks industry, which flaunts a Zacks Industry Rank #1 and places it at the top 1% of more than 250 Zacks industries.

FUJIFILM is expected to benefit from expanding healthcare business driven by acquisitions, including Hitachi’s Diagnostic Imaging-related business. Moreover, investments in gene therapy, one of the priority areas for growth in the CDMO business and regenerative medicine businesses, are expected to bolster its prospects in healthcare.
 

Fujifilm Holdings Corp. Price and Consensus

Fujifilm Holdings Corp. Price and Consensus
Fujifilm Holdings Corp. Price and Consensus

Fujifilm Holdings Corp. price-consensus-chart | Fujifilm Holdings Corp. Quote

The company’s earnings estimates for fiscal 2020 have moved up 7.9% in the past 60 days to $3.67 per share.

Fort Collins, CO-based supplier of power subsystems and process-control technologies, Advanced Energy Industries AEIS belongs to the Semiconductor Equipment - Wafer Fabrication industry, which carries a Zacks Industry Rank #2 (Top 1%).

Advanced Energy is well poised to gain from growing design wins across hyperscale and enterprise customers and solid momentum across 5G platforms at infrastructure equipment suppliers.
 

Advanced Energy Industries, Inc. Price and Consensus

Advanced Energy Industries, Inc. Price and Consensus
Advanced Energy Industries, Inc. Price and Consensus

Advanced Energy Industries, Inc. price-consensus-chart | Advanced Energy Industries, Inc. Quote

The company’s earnings estimates for 2020 have moved up 10.3% in the past 60 days to $3.31 per share.

Sunnyvale, CA-based provider of integrated, and automated cybersecurity solutions Fortinet FTNT belongs to the Security industry, which carries a Zacks Industry Rank #14 (Top 6%).

The company is benefiting from solid growth in Fortinet Security Fabric, cloud and SD-WAN offerings. Moreover, continued deal wins, especially those of high value, are likely to act as key catalysts. Higher IT spending on cybersecurity is also expected to be a tailwind.
 

Fortinet, Inc. Price and Consensus

Fortinet, Inc. Price and Consensus
Fortinet, Inc. Price and Consensus

Fortinet, Inc. price-consensus-chart | Fortinet, Inc. Quote

The Zacks Consensus Estimate for its 2020 earnings has moved north by 11.5% to $2.71 over the past 60 days.

St. Louis, MO-based IT and management consulting services provider, Perficient PRFT belongs to the Computer – Services industry, which carries a Zacks Industry Rank #23 (Top 9%).

Strength in the company’s comprehensive digital transformation services, including digital marketing and consulting solutions with advanced analytics capabilities is expected to be a growth driver. Moreover, focus on enhancing healthcare services bodes well.

Perficient, Inc. Price and Consensus

Perficient, Inc. Price and Consensus
Perficient, Inc. Price and Consensus

Perficient, Inc. price-consensus-chart | Perficient, Inc. Quote

The company’s Zacks Consensus Estimate for 2020 earnings has moved up 5.3% in the past 60 days to $2.37 per share.

Santa Rosa, CA–based provider of electronic design and test instrumentation systems, Keysight Technologies KEYS belongs to the Electronics - Measuring Instruments industry, which carries a Zacks Industry Rank #25 (Top 10%).

Keysight is well poised to capitalize on strong growth in the wireless ecosystem primarily driven by advancement in 5G investment. Apart from strength in 5G domain, Keysight’s efforts in other emerging growth markets like IoT and high-speed data centers, hold promise.

Keysight Technologies Inc. Price and Consensus

Keysight Technologies Inc. Price and Consensus
Keysight Technologies Inc. Price and Consensus

Keysight Technologies Inc. price-consensus-chart | Keysight Technologies Inc. Quote

Notably, over the last 60 days, fiscal 2020 estimates were revised, driving the Zacks Consensus Estimate by 5.9%, to $5.19 per share.

Zacks Top 10 Stocks for 2020

In addition to the stocks discussed above, would you like to know about our 10 top tickers for the entirety of 2020? These 10 are painstakingly hand-picked from over 4,000 companies covered by the Zacks Rank. They are our primary picks to buy and hold.

Start Your Access to the New Zacks Top 10 Stocks >>


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Fortinet, Inc. (FTNT) : Free Stock Analysis Report
 
Perficient, Inc. (PRFT) : Free Stock Analysis Report
 
Keysight Technologies Inc. (KEYS) : Free Stock Analysis Report
 
Fujifilm Holdings Corp. (FUJIY) : Free Stock Analysis Report
 
Advanced Energy Industries, Inc. (AEIS) : Free Stock Analysis Report
 
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