A lot of technology stocks are battered and bruised. Many once high-flying mega-cap tech stocks are taking it on the chin. This week, shares of Meta Platforms (NASDAQ:META) are down more than 10% after the tech giant issued disappointing guidance and mounting losses at its new ventures unit, Reality Labs. With interest rates expected to remain high for the foreseeable future, tech stocks seem particularly vulnerable to a downturn right now.
In recent weeks, entire subsectors of tech have moved lower, notably stocks of companies working in the areas of semiconductors, artificial intelligence (AI) and cybersecurity. How long the current downturn lasts is anyone’s guess. That said, there are some tech stocks that are showing tentative signs of recovery and could be poised for a turnaround in coming months, driven by earnings and other catalysts. Here are three tech stocks to buy in anticipation of an epic rebound.
Tesla (TSLA)
Tesla (NASDAQ:TSLA) is by no means out of the woods. The electric vehicle maker just reported its biggest revenue decline since 2012 and its first-quarter profit plunged 55% from a year earlier. That said, the worst of the selloff in TSLA stock appears to be over. In the two days since the company’s Q1 print, Tesla’s share price has risen 13%. The stock now looks to have bottomed at $138. Investors looking to bottom fish Tesla might want to buy the stock now.
A lot is riding on the company’s ability to bring a more affordable electric vehicle to market by early 2025, as CEO Elon Musk promised during the Q1 earnings call with analysts and media. Cost controls and plans to cut 10% of Tesla’s workforce will also be important, as is the ability to license its driver assistance system to other automakers. If Musk and his management team can pull it all off, then Tesla could prove to be one great comeback story. In the meantime, TSLA stock is trending upwards.
Texas Instruments (TXN)
Among semiconductor stocks, Texas Instruments (NASDAQ:TXN) has been a long-term laggard. In the last five years, TXN stock has risen 50%. Compare that to Nvidia’s (NASDAQ:NVDA) 1,817% gain over the same period. While disappointing, Texas Instruments looks like it might be starting to get its mojo back after years of chronic underperformance. The company’s share price rose 7% in a day after the legacy tech concern reported better-than-expected financial results for Q1 of this year.
Texas Instruments reported earnings per share (EPS) of $1.20, which was much better than Wall Street forecasts of $1.07. Revenue during the first three months of the year came in at $3.66 billion, also ahead of analyst estimates of $3.6 billion. In terms of guidance, Texas Instruments forecast Q2 revenue of $3.65 billion to $3.95 billion, and profits of $1.05 to $1.25 per share. The Q2 guidance aligns with Wall Street forecasts.
Apple (AAPL)
It might not be long before consumer electronics giant Apple (NASDAQ:AAPL) stages an epic rebound. In 2024, AAPL stock is one of the worst performers among tech securities. So far this year, Apple’s share price is down nearly 9%, and a laggard in the benchmark S&P 500 index. However, there are potential catalysts looming on the horizon. All eyes will be on the company’s May 2 earnings report. People will also be watching a May 7 event where Apple is expected to unveil a revamped version of its iPad tablet.
Apple’s signature tablet, the iPad, launched in 2010 and has not been significantly updated since 2018. A new iPad could help to boost sales of the device, which declined 25% to $7.02 billion in this year’s first quarter, according to industry estimates. Sales across all Apple products have suffered amid economic uncertainty and as consumers cutback on spending. Revitalizing its electronic devices could boost sales and AAPL stock. Unveiling AI applications at its developers conference in June could also help.
On the date of publication, Joel Baglole held a long position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
