3 Hot Tech Stocks Poised to Quintuple by 2027


  • These three hot tech stocks are well-positioned to deliver stellar returns and potentially quintuple in value by 2027.
  • PayPal (PYPL): This fintech pioneer is trading at a steep discount and is poised for a major rebound as consumer spending surges.
  • Snap Inc. (SNAP): The popular social media app is rapidly growing its user base and has immense long-term potential.
  • SentinelOne (S): This cutting-edge cybersecurity firm uses AI to provide autonomous threat protection, with profits set to soar.
hot tech stocks - 3 Hot Tech Stocks Poised to Quintuple by 2027

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Tech stocks have continued to drive the bulk of the market’s gains over the past two decades, and I think the trend will remain in place over the coming decades. We have many catalysts, like AI, quantum computing, and other breakthrough technologies, that could reshape the world. That said, betting on these up-and-coming technologies involves a lot of risk. Plus, you’ll have to hold for a very long time to see meaningful gains if you invest in many of these companies right now.

On the other hand, there are many hot tech stocks with very popular underlying businesses that could supercharge your portfolio over the next three years. It’s a very short timeframe, but I have good conviction that these companies can repeat the multi-bagger gains they’ve provided investors over the past two years.

Here are three hot tech stocks to consider right now.

PayPal (PYPL)

PayPal logo and front of headquarters

PayPal (NASDAQ:PYPL) enables digital and mobile payments for consumers and merchants around the world. I believe PayPal is one of the most undervalued fintech stocks right now, is poised for a major rebound. While the entire fintech sector has struggled in recent years, PayPal’s Q1 results show resilience. The company reported 10% currency-neutral revenue growth on $404 billion in total payment volume. Transaction margins grew a solid 4% despite headwinds, driving a 27% surge in the company’s earnings per share.

Most encouragingly, active accounts are growing sequentially again. With its strong cash flows, PayPal repurchased a hefty $5 billion in stock last year and wants to do the same this year. As interest rates eventually ease and consumer spending rebounds, I expect PayPal’s transaction volumes to re-accelerate significantly.

The company is retooling to drive profitable growth, and management now sees full-year earnings per share rising in the mid-to-high single digit range. The core financials here suggest that PayPal should’ve rebounded long ago.

PYPL financials. Hot tech stocks.
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Source: Chart courtesy of GuruFocus.com

Trading at just 15-times forward earnings, a 50% discount to its pre-pandemic average, PYPL stock looks like a coiled spring ready to explode higher.

Snap Inc. (SNAP)

An apple iPhone showing the snapchat application alongside other snapchat logos. SNAP stock.
Source: Ink Drop / Shutterstock.com

Snap Inc. (NYSE:SNAP) operates the popular social media app Snapchat. I believe Snap is a hot tech stock poised for explosive growth in the coming years. The company reported strong Q1 results, with revenue surging 21% year-over-year to $1.19 billion, handily beating estimates by $74 million.

Additionally, Snap’s earnings per share are projected to skyrocket from 25 cents currently to $1.60 by 2027 as its advertising platform gains momentum. I see a similar rebound story playing out here as with Meta Platforms (NASDAQ:META). Snap’s stock has multiple upside drivers ahead, with the potential U.S. TikTok ban being the most immediate catalyst that could send shares soaring. Even without that catalyst, if the company meets estimates, we could see a huge spike ahead.

SNAP TTM financials
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Source: Chart courtesy of GuruFocus.com

Snapchat’s user base continues expanding rapidly, reaching 422 million daily active accounts in Q1, up 39 million or 10% year-over-year. However, Snap’s average revenue per user (ARPU) growth has remained muted in recent quarters. I believe there is tremendous potential to ramp up ARPU going forward as Snap further monetizes its highly-engaged audience. This is definitely one of the hot tech stocks to buy right now!

SentinelOne (S)

The logo for SentinelOne (S) is seen on on an office building.
Source: Tada Images / Shutterstock.com

SentinelOne (NYSE:S) provides autonomous cybersecurity solutions powered by artificial intelligence. I believe this innovative cybersecurity firm is a compelling buy after its recent pullback, as demand for its threat protection services should only accelerate in an AI-driven world.

In Q1, SentinelOne delivered an industry-leading 40% revenue growth to $186 million while expanding gross margins to a record 79%. Remarkably, the company achieved positive free cash flow far ahead of schedule, with an impressive 18% free cash flow margin. After 11 straight quarters of 25+ points of operating leverage, SentinelOne has now reached breakeven on an earnings per share basis. The company’s EBIT is expected to inflect soon, too.

SentinelOne EBIT
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Source: Chart courtesy of GuruFocus.com

Oh, and despite earlier losses, the company’s balance sheet is solid.

SentinelOne balance sheet
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Source: Chart courtesy of GuruFocus.com

Looking ahead, I expect profits to inflect sharply higher as top-line growth remains robust and margin expansion continues. Consensus estimates project earnings per share will surge from 3 cents this year to 23 cents next year before exceeding $4 by fiscal 2034. Thus, I believe SentinelOne is poised to be a cybersecurity powerhouse for years to come.

On the date of publication, Omor Ibne Ehsan did not hold (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.

Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.

Article printed from InvestorPlace Media, https://investorplace.com/2024/06/3-hot-tech-stocks-poised-to-quintuple-by-2027/.

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