In the dynamic stock market realm, tech stocks to buy have consistently been the beacon leading the charge for all-time highs, underpinning the sector’s long-term growth potential. Despite the unsettling layoffs, this period harbors a silver lining for discerning investors. Historically, tech sector downturns have unveiled lucrative long-term buying opportunities, a trend likely to spill over into 2024. Layoffs, while often viewed through a grim lens, can efficiently catalyze a company’s evolution towards streamlined operations, heightened efficiencies, and a clear focus. For tech entities, this process is not just about slashing costs but enhancing value-added and per-capita effectiveness, setting the stage for sustainable success. Amidst this backdrop, certain tech stocks emerge as compelling investments, promising revitalized frameworks and potentially elevated valuations in the wake of downsizing.
Tech Stocks To Buy: Apple (AAPL)
Relative % Below (52-Week High): 18.3%
Apple’s (NASDAQ:AAPL) recent journey through turbulent times, marked by dropping iPhone sales within the key Chinese market, has cast a shadow over its ubiquitous dominance. The fourth-quarter results showed a 13% dip in iPhone sales across China, exacerbating concerns among investors and stakeholders. Yet, it’s imperative to recognize that this setback is part of a broader narrative that doesn’t undermine Apple’s inherent value and many opportunities.
In dissecting Apple’s situation, it’s critical to acknowledge the resilience and adaptability that has become synonymous with its brand. Despite the slowdown in hardware sales, Apple’s services segment has emerged as a powerful counterbalance, demonstrating stellar growth and compensating for any perceived shortcomings in device sales. Furthermore, Apple’s capacity to exceed Wall Street’s top and bottom-line expectations amidst these challenges underscores its operational ability and market understanding. Furthermore, the introduction of Apple Vision Pro, hailed by Wedbush Securities analyst Daniel Ives as a potential “game-changer,” is poised to invigorate Apple’s product lineup. With an anticipated sale of 600,000 units in 2024, Apple Vision Pro is a testament to Apple’s innovative spirit.
Alphabet (GOOG, GOOGL)
Relative % Below (52-Week High): 12.6%
Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), Google’s parent company, exemplifies the virtue of patience fused with its persistent innovation, especially in the fast-evolving artificial intelligence (AI) realm. While the AI fervor escalates, Google has been comfortably exceeding expectations, leveraging YouTube’s advertising potential that many have long awaited. The video-sharing giant is refining its monetization tactics, implementing key measures including blocking ad blockers and rolling out premium features, strategies which are beginning to bear fruit. Coupled with Google Search, YouTube is crafting a competitive edge, positioning Alphabet towards sustainable, double-digit growth.
The figures are telling: Alphabet’s sales soared to $307.4 billion, a commendable 10% year-over-year (YOY) bump, with YouTube’s $9.2 billion contribution last quarter underscoring the promise of this platform. Furthermore, Alphabet’s recent unveiling of the Gemini AI upgrade signals its intent to compete head-on with OpenAI’s breakthroughs. By harnessing its expansive data across a myriad of domains, Alphabet is effectively positioning itself to maximize AI monetization.
Tech Stocks to Buy: Advanced Micro Devices (AMD)
Relative % Below (52-Week High): 12.8%
Advanced Micro Devices (NASDAQ:AMD) has emerged as a standout performer in the competitive semiconductor realm, boasting more than 90% in stock value in the past year. This growth titan delivered another strong quarter of sales increase, an 11% increase from the prior year, beating estimates by $60 million.
Furthermore, the company’s forward-looking stance is evidenced by its ambitious projection of $3.5 billion in data center revenue this year, which marks a substantial 75% jump from its earlier $2 billion forecast. Its data center revenue in the last quarter alone increased by 38% YOY, bolstered by a remarkable quarterly bump of 43%. This surge stems from its triumph in CPU and data center GPU revenues, surpassing expectations, thanks partly to the new AI-focused MI300X GPU. This innovative chip is quickly gaining traction, poised to snatch market share from the current leader, Nvidia (NASDAQ:NVDA), with its superior speed, efficiency and robust pricing strategy.
IBM (IBM)
Relative % Below (52-Week High): 17.6%
IBM (NYSE:IBM) is showcasing its prowess in AI and strategic innovation, ushering in a new era of growth and tech leadership. The tech giant is providing a bullish 2024 top-line expansion guidance of roughly 5%, excluding currency fluctuations, a figure that comfortably surpasses analysts’ average expectations. IBM underscores its forward-looking stance in the tech sphere. This optimistic projection is bolstered by an anticipated impressive free cash flow of about $12 billion for the year.
The deployment of AI systems across IBM’s customer base is pushing for the increased demand for both its software and services, illustrating the transformative impact of AI on the tech sector. CEO Arvind Krishna’s revelation, which shows that IBM’s AI-related pipeline had doubled from the third quarter to the fourth quarter, further emphasizes the company’s dynamic engagement with AI technologies. Moreover, its strategic focus on hybrid cloud, security, AI, and quantum computing, highlighted by the unveiling of its 433-qubit Osprey processor, positions it uniquely in the tech domain.
Tech Stocks to Buy: Netflix (NFLX)
Relative % Below (52-Week High): 7%
Netflix’s (NASDAQ:NFLX) journey post-pandemic epitomizes its robust position in the streaming market. Amid initial setbacks, including subscriber declines which cast doubts on its growth trajectory, Netflix has pivoted remarkably, showcasing a compelling resurgence. This turnaround is a testament to the company’s adeptness in navigating the competitive streaming landscape, where it continues to assert its dominance.
The secret to Netflix’s sustained momentum lies in its commitment to enriching its content library, a diverse mix that spans various genres and languages, appealing to a global audience. The record addition of 13.1 million global streaming subscribers in the fourth quarter alone, significantly up from 7.7 million in the same quarter the previous year, emphasizes the platform’s unparalleled appeal and market penetration. Closing 2023 with a staggering 260 million paid memberships and reporting a vigorous 12.5% revenue growth in the fourth quarter, Netflix’s trajectory is on an extraordinary upswing.
Block (SQ)
Relative % Below (52-Week High): 35.2%
Block (NYSE:SQ) stands as a true titan in the fintech landscape, navigating past challenges to effectively position itself on the cusp of robust growth, thanks to the industry’s explosive expansion. This fintech has captured the attention with its latest ventures into self-custody wallets and a Web5 toolkit, setting new benchmarks in decentralized app development. These innovations effectively diversify Block’s portfolio as it stands as a true juggernaut in the fintech sphere, ensuring its competitive edge remains sharp in a rapidly evolving market.
Financially, Block has demonstrated resilience and strength, with third-quarter GAAP earnings per share surpassing expectations by six cents. This performance, coupled with a significant 24.3% YOY revenue increase to $5.62 billion, exceeded forecasts by $190 million, highlighting a robust upward financial trajectory. Block’s strategic foray into various fintech domains, including digital payments and cryptocurrency, positions it advantageously in the financial ecosystem. The company’s broadening product portfolio and proactive market engagement signal a well-crafted strategy to leverage emerging trends.
T-Mobile US (TMUS)
Relative % Below (52-Week High): 10.1%
T-Mobile US (NASDAQ:TMUS) is a standout performer among the leading 5G wireless carriers, showcasing unparalleled performance over the past year. In 2023, the carrier’s strategic moves paid off incredibly, with an impressive addition of 1.3 million postpaid accounts. Moreover, its fourth-quarter report highlighted that its Ultra Capacity 5G network covers approximately 300 million Americans, equating to 98% of the U.S. population.
Furthermore, T-Mobile’s prowess is equally impressive. The company reported an adjusted 2023 free cash flow of $13.59 billion, an amazing 77% bump from the previous year, translating to a healthy % free cash flow yield of 4.5%. Beyond the numbers, T-Mobile’s strategy of bolstering its presence in stadiums and entertainment venues significantly enhances its brand visibility. Its strategic initiatives have fostered a bullish sentiment among analysts, with Tipranks analysts rating TMUS stock as a ‘strong buy.’ The anticipated 14% bump in value, with a 12-month forecast price of $204, underscores the confidence in T-Mobile’s trajectory as a leading stock within the 5G technology sphere.
On the date of publication, Muslim Farooque 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.
