5 Cheap Technology Stocks Amid the Sector’s Weakness

Fresh opportunities are cropping up in the tech space as an online sales tax possibility weighs on future profits

By Anthony Mirhaydari, InvestorPlace Market Strategist

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U.S. equities were pressured on Thursday as a Supreme Court decision against technology stocks hit the FAANG group particularly hard. That is, investors feared increased sales tax collection will weigh on tech profits.

Other concerns remain in the air as well, including ongoing trade tensions, central bank policy tightening and bond market rumblings out of the Eurozone as the situation in Italy attracts fresh attention.

The result is the Dow Jones is poised extend its longest losing streak since the 1970s as the Nasdaq Composite finally shows some of the weakness the rest of the market has been showing for weeks.

Amid the selloff, some fresh opportunities are popping up in the technology sector. Not the overpriced mega-caps like Amazon (NASDAQ:AMZN) but smaller players that have been lost in the shuffle.

Value investors are sniffing around, looking for an entry point. Here are five cheap tech stocks to watch that are trading at a relative discount, on a technical basis:

Cheap Tech Stocks: First Solar (FSLR)

First Solar (NASDAQ:FSLR) shares are down nearly 35% from the highs reached in late April on concerns over oversupply in the solar panel industry. Cascend Research analysts warned last week that prices are falling on overcapacity out of China. But a low could be in, with Credit Suisse analysts upgrading their rating on the stock on Tuesday. Felt

The company will next report results on July 26 after the close. Analysts are looking for earnings of a penny per share on revenues of $503.9 million. When the company last reported on April 26, earnings of 78 cents beat estimates by 87 cents on a 36.4% decline in revenues.

Cheap Tech Stocks: Xerox Corp. (XRX)

Xerox (NYSE:XRX) shares have fallen to levels not seen since early 2017 amid negative headlines related to walking away from a merger agreement with Fujifilm. And the difficultly activist investor Carl Icahn is having to find a buyer. But the company is profitable and Icahn has a long history of successes. Watch for a run back above $30.

The company will next report results on Aug. 1 before the bell. Analysts are looking for earnings of 87 cents per share on revenues of $2.49 billion.

When the company last reported on May 2, earnings of 68 cents per share missed estimates by five cents on a 0.8% decline in revenues.

Cheap Tech Stocks: IBM (IBM)

IBM (NYSE:IBM) shares are down more than 16% from their highs amid ongoing concern about its new business efforts in the cloud, tepid revenue growth in recent years, and Warren Buffett’s announcement in May that he had completely exited his position in the company. Watch for the May lows to hold and usher in a retest of the 200-day moving average.

The company will next report results on July 18 after the close. Analysts are looking for earnings of $3.05 per share on revenues of $19.9 billion. When the company last reported on April 17, earnings of $2.45 beat estimates by three cents on a 5.1% rise in revenues.

Cheap Tech Stocks: Intel (INTC)

Intel (NYSE:INTC) shares are breaking down below their 50-day moving average and look vulnerable to a decline back to the early April levels.

This after the company announced the sudden resignation of its CEO because of the discovery of a relationship with a co-worker. This will prove a buying opportunity as the company remains at the center of the rise of the internet of things.

The company will next report results on July 26 after the close. Analysts are looking for earnings of 86 cents per share on revenues of $16.3 billion.

When the company last reported on April 26, earnings of 87 cents beat estimates by 15 cents on an 8.8% rise in revenues.

Cheap Tech Stocks: Oracle (ORCL)

Oracle (NYSE:ORCL) shares have returned to early 2017 levels and are down nearly 20% from their March highs following the issuances of forward guidance that provided less insight into its growing cloud business than usual — raising suspicion things aren’t going so well.

Few companies are as well positioned to play a major role in this space, however.

The company will next report results on Sept. 13 after the close. Analysts are looking for earnings of 69 cents per share on revenues of $9.3 billion.

When the company last reported on June 19, earnings of 99 cents per share beat estimates by five cents on a 2.9% rise in revenues.

Anthony Mirhaydari is the founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.


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Article printed from InvestorPlace Media, https://investorplace.com/2018/06/5-cheap-technology-stocks-amid-the-sectors-weakness/.

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