7 Butchered Tech Stocks to Buy and Hold


  • Declines in robust tech stocks make them increasingly attractive for long-term portfolios.
  • Akamai Technologies (AKAM): Over 50% of Fortune 500 companies are customers.
  • AppLovin (APP): A new partnership brings a large set of new customers to the advertising bidding system.
  • Electronic Arts (EA): Rebranding of a flagship product has resulted in a dramatic reduction in licensing fees.
  • LendingTree (TREE): The creation of a new automated pre-approval system will bring customers from three new partners.
  • Monolithic Power Systems (MPWR): The power electronics house has delivered robust metrics even during money tightening times.
  • Opendoor Technologies (OPEN): The launch of a new financing app promises to pre-approve customers in as little as two minutes.
  • Open Text (OTEX): Canada-based information management heavyweight will appeal to dividend seekers.
tech stocks - 7 Butchered Tech Stocks to Buy and Hold

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Tech stocks have faced significant challenges so far in the first half of 2022. Investors have moved away from many growth names in the sector.

So far in 2022, a confluence of macroeconomic and geopolitical concerns have meant challenges for Wall Street. As T. Rowe Price (NASDAQ:TROW) recently reported, “The Federal Reserve’s most aggressive rate hike since 1994 raised recession fears… The S&P 500 index recorded its worst weekly decline since March 2020 and entered a bear market, ending the week nearly 24% below its January peak.”

In addition, the tech-heavy Nasdaq composite has fallen around 20% since the beginning of the year.

Despite the recent downturn, technology remains in integral part of modern life. If history is any guide, it is likely that the strong companies sector will rebound in the coming months.

With that information, here are seven tech stocks to buy and hold in June.

Ticker Company Current Price
AKAM Akamai Technologies, Inc. $91.87
APP AppLovin Corporation $38.14
EA Electronic Arts Inc. $128.96
TREE LendingTree, Inc. $54.87
MPWR Monolithic Power Systems, Inc. $399.65
OPEN Opendoor Technologies Inc. $5,38
OTEX Open Text Corporation $38.40

Tech Stocks: Akamai Technologies (AKAM) 

building facade with akamai (AKAM) logo on it. representing tech stocks
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During the pandemic, the content delivery network specialist Akamai Technologies (NASDAQ:AKAM) has been a darling on Wall Street during. It provides cloud services for delivering and optimizing business applications. Over 50% of Fortune 500 companies rely on its product offerings.

AKAM announced Q1 results on May 3. Revenues came in at $904 million, up 7% from a year ago. Earnings per share was $1.39, an increase of 1%. Cash and equivalents was $1.3 billion.

On June 6, AKAM launched new malware protection for uploaded files. The solution detects and blocks malware at the edge preventing malicious content from reaching and jeopardizing targeted systems.

AKAM stock is down 21% so far this year. Shares are trading at 17.4x  forward earnings and 4.7x sales. Meanwhile, the 12- month price forecast for AKAM stands at $118.

AppLovin (APP)

The AppLovin (APP) info on an iPhone and laptop screen.
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AppLovin (NASDAQ:APP) provides various services to mobile app developers. It boasts some 140,000 apps in its portfolio. Services include analytics, marketing, mobile advertising, monetization, and publishing.

In mid-May, management released Q1 earnings. Revenue came in at $625 million, compared to $604 million the year before. Diluted net loss per share was 31 cents, compared to a loss of 5 cents the year before. Cash and equivalents totaled $1.4 billion.

Recently, AppLovin announced a new partnership with Trade Desk (NASDAQ:TTD) to bring the AppLovin advertising exchange to the Trade Desk platform. As a result, TDD’s clients will now be able to purchase advertising bids on AppLovin’s smartphone apps through the Unified ID 2.0 platform.

Like many growth names, APP stock has crashed hard, falling 62% since Jan. 1. Forward price-earnings (P/E) and price-sales (P/S) numbers are 20.5x and 5.3x, respectively. Lastly, the 12-month median forecast is at $72.

Electronic Arts (EA)

There Doesn't Appear to Be a Clear Path Forward for EA Stock
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Electronic Arts (NASDAQ:EA) develops and publishes video games. The company owns several established game franchises, including Battlefield, Mass Effect, Dragon Age and Apex Legends. It also operates the Origin game distribution platform and the DICE, BioWare, and Respawn Entertainment game studios.

In early May, the publisher issued Q4 results for its fiscal 2022 year. Total net revenue was $1.8 billion, compared to $1.3 billion the year before. Diluted EPS was 80 cents, compared to 26 cents the year before. Operating cash flow was $444 million.

Recently, management announced a major change to its best-selling EA Sports franchise, dropping FIFA from its soccer video games and rebranding them as EA Sports FC. The change comes after failed negotiations as FIFA upped the licensing fee to over $1 billion every four years.

EA stock is trading flat for the year but has dropped 10% over the past 12 months. Forward P/E and P/S numbers are 18.2x and 5.3x, respectively. Meanwhile, the 12-month median forecast is at $155.

Tech Stocks: LendingTree (TREE)

Lending Tree (TREE) website under magnifying glass
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LendingTree (NASDAQ:TREE) is an online lending marketplace with a variety of financial products. Its offerings include mortgages, credit cards, auto loans, insurance, and student loans.

In early May, LendingTree released Q1 financial results. Consolidated revenue was $283.2 million, a 4% increase from a year ago. Adjusted net income per share was 46 cents, compared to 18 cents the year before. Cash and equivalents totaled $196.7 million.

Recently, the company announced Mercury General (NYSE:MCY), Avant and Ally Financial (NYSE:ALLY) as the founding partners of TreeQual, LendingTree’s new pre-approval system. Lenders will be able to identify qualified members for loans and credit cards. Meanwhile, customers will be able to shop and compare between various offers.

TREE stock has lost around half of its value in 2022. Forward P/E and P/S numbers stand at 19.9x and 0.7x. Wall Street’s 12-month median forecast is $140.

Monolithic Power Systems (MPWR)

Monolithic Power Systems, Inc logo is seen on a mobile phone and a computer screen
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Monolithic Power Systems (NASDAQ:MPWR) develops high-performance, semiconductor-based power electronics solutions. Its products have a wide variety of uses in computing, automotive as well as data storage and other consumer related industries.

MPWR reported Q1 financial results on May 2. Revenue was $377.7 million with a massive increase of 48.4% from a year ago. Diluted EPS was $2.45 compared to $1.46 in the same quarter of 2021.

In late May, Monolithic launched the MPSafe portfolio of automotive-grade products. Customers will be better able to meet various Automotive Safety Integrity Level (ASIL) requirements. And investors expect to see top-line results.

MPWR stock is down 19% so far this year. Shares are trading at 12.4x forward earnings and 1.9x sales. Meanwhile, the 12-month price forecast for MPWR stands at $570.

Opendoor Technologies (OPEN)

A picture of the OpenDoor (OPEN stock) app on a phone.
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Opendoor Technologies (NASDAQ:OPEN) buys and sells residential real estate. It operates by making cash offers on homes online. Then it repairs and upgrades those properties to relist them for sale. In the first quarter of this year, Opendoor had an inventory balance of 13,360 homes stateside.

In early May, the real estate platform issued Q1 figures. Revenue was $5.2 billion, up 590% from a year ago. Diluted EPS was 4 cents, compared to a diluted loss per share of 48 cents the year before. Cash and equivalents were $2.8 billion.

Recently, management announced the launch of a new Opendoor financing app, designed to facilitate the mortgage approval process. For now, this app will be available for customers in California.

So far in 2022, OPEN stock has fallen 63%. Shares are trading at 0.34x sales. Finally, the 12-month median forecast stands at $13.

Tech Stocks: Open Text (OTEX)

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Canadian information management group Open Text (NASDAQ:OTEX) provides software and related services. OTEX announced results for its fiscal third quarter on May 4. Revenue was $882.3 million, up 5.9% from the prior-year period. EPS was 70 cents, down 6.7%. Free cash flow was $306 million.

Recently, the cloud-based IM provider received a 2022 SAP Pinnacle Award in the Partner Solution Success category, in recognition of its exceptional contributions as an SAP partner.

OTEX stock is down 19% on the year. The dividend yield stands at 2.4%. Shares are changing hands at 11.2x forward earnings and 3.2x sales. Analysts’ 12-month price forecast for OTEX stands at $54,75.

On the date of publication, Tezcan Gecgil 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.

Article printed from InvestorPlace Media, https://investorplace.com/2022/06/7-butchered-tech-stocks-to-buy-and-hold/.

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