There are more than 3,500 publicly listed companies in the U.S. today. Yet a handful of stocks get all the attention from the media, analysts and investors. These tend to be the mega-cap tech stocks that dominate the market and are responsible for the majority of its gains and losses. Attention tends to go to companies such as Apple (NASDAQ:AAPL) because they have so much influence over the market’s direction instead of some under-the-radar tech stocks.
While it makes sense that the most influential stocks should get most of the attention, it also means many great under-the-radar tech stocks. This is disappointing as many of these neglected stocks are quietly rising and beating the returns seen in the broader market. Spotting these hidden gems can add big gains to a portfolio.
Here are three under-the-radar tech stocks with millionaire-maker upside.
Applied Materials (AMAT)
Applied Materials (NASDAQ:AMAT) doesn’t get nearly as much attention as it deserves. Companies such as Nvidia (NASDAQ:NVDA) use the microchip-equipment maker’s components. Yet the company and its stock receive only a fraction of the media attention given to its customers. This is largely due to Applied Materials being a going concern since 1967 and being viewed as Silicon Valley’s founding father.
Some of Applied Materials’ equipment is so old that it is housed at the Smithsonian Museum. Regardless of its age, Applied Materials is still posting strong financial results, and its stock is responding. For its fiscal second quarter, Applied Materials most recently announced EPS of $2.09, which was ahead of analyst consensus estimates that called for a profit of $1.99 a share. Revenue totaled $6.65 billion, topping Wall Street forecasts of $6.54 billion.
The strong results and bullish forward guidance continue to send AMAT stock higher. In the last 12 months, Applied Materials’ share price has risen 67%.
Palo Alto Networks (PANW)
For an under-the-radar cybersecurity stock, look to Palo Alto Networks (NASDAQ:PANW). The company’s stock is up 18% this year, but it badly trails the gains seen in its competitors, such as CrowdStrike (NASDAQ:CRWD), whose share price has gained 57%. The big problem at Palo Alto Networks is that the company has missed Wall Street forecasts on several occasions.
Most recently, Palo Alto Networks reported quarterly billings that missed analyst estimates, sending its stock down nearly 10%. For the company’s fiscal third quarter, billings came in at $2.33 billion, missing analysts’ average estimate of $2.34 billion. U.S. Analysts see the disappointing billing figure as a sign of reduced corporate spending on cybersecurity solutions, creating headwinds.
Despite the near-term challenges, 38 Wall Street analysts who cover the company rate Palo Alto Networks’ stock a “strong buy” and expect future gains.
Analog Devices (ADI)
Like Applied Materials, Analog Devices (NASDAQ:ADI) is a semiconductor company whose stock flies under the radar of most investors but nevertheless outperforms. So far, in 2024, ADI stock is up nearly 20%. In the last five years, the share price has more than doubled. Also, like Applied Materials, Analog Devices continues to post strong quarterly prints that underpin its share price.
In May of this year, Analog Devices announced EPS of $1.40 for its fiscal second quarter, beating analysts’ consensus forecast of $1.26. Revenue came in at $2.16 billion, beating expectations for $2.11 billion. The company, which makes semiconductors used in data conversion and signal processing, attributed the strong results to rising orders and demand for its products, particularly in the automotive and industrial sectors.
Looking ahead, Analog Devices raised its forecast for the year’s second quarter, saying it expects revenue of $2.27 billion, plus or minus $100 million. Analysts had forecast $2.16 billion in fiscal third-quarter sales. ADI stock also pays a quarterly dividend of 92 cents, giving it a yield of 1.60%.
On the date of publication, Joel Baglole held long positions in AMAT and NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
