The 3 Most Undervalued Tech Stocks to Buy in May 2024


  • 2024’s undervalued tech stocks are surging, catalyzed by Nvidia’s (NVDA) rise and Fed rate cuts. Invest in AI innovators with strong buy ratings and high potential.
  • CrowdStrike (CRWD): Enhanced AI and cloud security partnerships position CRWD stock for robust growth in cybersecurity.
  • Amazon (AMZN): The e-commerce giant’s expansion in AWS and new services underscores its strong growth trajectory.
  • Taiwan Semiconductor Manufacturing (TSM): TSMC’s new Arizona plant investment under the CHIPS Act highlights its expansion and innovation strength.
undervalued tech stocks - The 3 Most Undervalued Tech Stocks to Buy in May 2024

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Undervalued tech stocks are attracting eyeballs this year because of two elements: the astronomical rise of Nvidia (NASDAQ:NVDA) and the three anticipated rate cuts from the now more dovish Federal Reserve.

This is why the tech sector is up 13.5% so far this year, better than the S&P 500‘s 9% gain. Goldman Sachs says the index will return 6%, which includes dividends, which means to beat the market this year, invest in undervalued tech stocks.

Analysts have given all three of the undervalued tech stocks we will look at a “strong buy” rating with double-digit upsides. This is because they are all working on new ways to make AI more widely used and to protect data.

The first pick on this list of undervalued tech stocks is a cybersecurity expert teaming up with AWS and Tata Consultancy Services (TCS). The second has a platform with over 200 million customers and wants to expand beyond Taiwan by including sports broadcasts and speedier delivery. The final selection partners with the U.S. Department of Commerce to potentially receive $6.6 billion in funding for a new manufacturing factory in Arizona.

Come on, let’s explore further!

Amazon (AMZN)

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Amazon (NASDAQ:AMZN) stock has made a big comeback and is now selling at around $188, which is up 25% from the start of the year, but most analysts are still recommending that investors “buy” the stock, with a target price of $219.5 per share for the next 12 months, a 16% upside.

Part of the reason for optimism is consistent innovation and growth. For example, Amazon is working overtime to expand its Amazon Web Services (AWS) system. AWS opened a new region in Calgary, Canada, the company’s second infrastructure area in the country. Amazon has also created the AWS European Sovereign Cloud to meet the needs of businesses in Europe subject to strict rules.

In the meantime, CES 2024 saw Amazon and Siemens (OTCMKTS:SIEGY) announce a partnership to link Amazon Bedrock to Siemens’ Mendix platform. This alliance seeks to make creative AI technologies easy to use in many sectors.

On the streaming end, Amazon Prime Video is adding more sports shows from around the world, like NASCAR and Wimbledon tennis in certain regions.

AMZN investors should monitor Amazon Prime, which includes the streaming business, since its 200 million users generated $40.2 billion in 2023. In 2021, growth was 33%; in 2023, 8%. Market saturation, notably in the U.S., caused this slowdown. Amazon is offering Prime members speedier delivery, exclusive bargains, and more entertainment, to stop the drop.

CrowdStrike (CRWD)

A sign with the Crowdstrike (CRWD) company logo
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CrowdStrike (NASDAQ:CRWD) investors are thrilled about its new deal with AWS, which will speed up the growth of AI and cloud security. The deal also includes making more use of Amazon Bedrock and Amazon SageMaker and standardizing security on CrowdStrike’s AI-native Falcon platform.

CrowdStrike and Tata Consultancy Services have also made a global strategy deal to use Falcon XDR to change the way business hacking is done. Falcon’s combined protection, which includes cloud security and next-generation security information and event management (SIEM), will be available to TCS through this deal. This will allow AI-powered system-on-chip (SOC) change that stops hacks.

The National Australia Bank and CrowdStrike are also working together to keep small and medium-sized businesses safe online.

These interactions and partnerships have made CrowdStrike well-known in its sector. KuppingerCole and IDC rank it as a leader in Identity Threat Detection and Response and in the 2024 Worldwide Managed Detection and Response MarketScape.

Lastly, new ideas are a big part of CrowdStrike’s success and potential upside of 25%. CrowdStrike said at Google Cloud Next ’24 that it would also be adding new security tools to the Google Cloud Marketplace.

Taiwan Semiconductor Manufacturing (TSM)

image of TSM semiconductor office building
Source: Sundry Photography /

Taiwan Semiconductor Manufacturing (NYSE:TSM) and the U.S. Department of Commerce recently agreed to collaborate. As a result of the tie-up, TSMC could receive up to $6.6 billion in funds through the CHIPS Act.

It’s part of their plan to build a third manufacturing plant in Arizona. That plant will make advanced electronics. With this addition, TSMC will have invested over $65 billion in Arizona so far.​

TSMC is also expanding its business worldwide, opening a second chipmaking plant in Japan. The new factory is part of Taiwan-based TSMC’s plan to increase the reliability of its supply chain and expand its production sites.​

In addition, India and TSMC are working together to see if it is possible to set up a hub for semiconductors there. This move is part of larger talks between Taiwan and India.

The excitement around chipmaker Nvidia is also helping TSMC’s shares. Thanks to its AI hardware solutions, Nvidia is the third U.S. firm with a $2 trillion market worth and is driving the tech-led market revival in 2024.

TSMC’s shares rose after Morgan Stanley boosted its Nvidia target price, illustrating their correlation. However, TSMC does not need Nvidia to stand on its own feet; the stock holds a “strong buy” consensus rating, with a 16% projected upside.

On the date of publication, Faizan 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 Publishing Guidelines.

Faizan Farooque is a contributing author for and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.

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