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Over the past few months in the market, some stocks have significantly declined in price and valuation. It is not just a few companies, however. The general market has experienced a lot of selling during this period. COVID’s uncertainty, supply-chain issues, and rising inflation have contributed to this.
For long-term investors, these sharp market declines have presented opportunities to purchase strong companies at a discount. Let’s take a look at three beaten down tech stocks currently trading at attractive levels that could be great additions to your long-term portfolio.
NVDA
Nvidia (NVDA - Free Report) is a worldwide leader in visual computing technologies and one of the bigger growth names in the market. Shares are down 20% year-to-date, and the chip giant has fallen roughly 40% from its all-time-high of $346 per share last November. NVDA is currently a Zacks Rank #2 (Buy) which means the majority of covering analysts expect the stock to outperform the broader market.
NVDA has a Value Style Score of F, and currently, its P/E is 47.26X. Book value per share has increased from 3.08 in 2018 to 6.03 in 2021.
Over the last 60 days, three analysts have raised their earnings outlook for fiscal 2022, and the consensus estimate has increased by six cents to $5.19 per share. Revenue is forecasted to jump in the double-digits as well, and the company’s top line should jump about 60% year-over-year to $26.7 billion in 2022. On average, NVDA has beaten earnings consensus by 7% over the last four quarters, and in their most recent report, the company beat expectations by 8.20%.
Nvidia has been affected directly by the chip shortage, which the recent negative price action reflects. However, the demand for these chips has increased significantly and Nvidia’s financial data looks rock solid with a clear path for sustained future growth. Once supply chains start working smoothly and the chip shortage has subsided, Nvidia will be ready to continue its rise. With its current price and strong Zacks Rank, I believe NVDA to be an attractive option for long-term investors.
OLED
Universal Display Corporation (OLED - Free Report) develops technology and intellectual property for the OLED (Organic Light Emitting Diodes) business. OLED is down close to 16% year-to-date and is down 47% from its all-time-high in January of 2021. OLED is currently a Zacks Rank #2 (Buy).
OLED has a Value Style Score of D and shares trade at a 27.72X forward earnings multiple. OLED’s trailing 12-month net profit margin is 35.03% compared to the industry’s average of 7%. OLED is positioned at the top of their industry and is a leader within it.
OLED has an average earnings surprise of 36.50% over the last four quarters; its most recent surprise was –11.01%. For fiscal 2021, there has been one positive earnings estimate revision and one for fiscal 2022 over the last 60 days. The consensus estimate has increased by 0.79%, or three cents, to 3.85 for fiscal 2021 over the past 60 days. OLED’s EPS is expected to grow by 37.50% for the current year and its estimated EPS long-term growth rate is 31.32% over the next three to five years.
Similar to other companies, OLED has suffered due to supply-chain constraints and the chip shortage. Price action aside, OLED has put together strong earnings reports over the last year. When combining its impressive numbers and strong Zacks Rank, OLED looks very promising for future growth and would be another attractive option for long-term investors.
AMD
Advanced Micro Devices (AMD - Free Report) develops computer processors and other similar products for both businesses and consumers. AMD shares are down nearly 23% year-to-date, and AMD has declined around 32% from its-all-time high mark of $165 per share from last November. AMD is a Zacks Rank #1 (Strong Buy).
AMD’s forward price-to-earnings ratio is 28.08X, and has increased its book value per share by $1.43 to $6.25 from 2020 to 2021. The company’s average surprise over their last four earnings reports has been 17.03% and their most recent surprise was 22.67%. Advanced Micro Devices’ full-year earnings are expected to grow 43.37% year-over-year.
Over the last 60 days, there have been 17 total positive estimate revisions for 2022 and 2023. AMD’s consensus estimate for 2022 has risen $0.72 to $4.00 per share and the estimate for 2023 has risen $0.97 to $4.77 per share, respectively.
AMD has been hit hard by the current sellers’ market. However, with extreme demand for the type of products that they produce, AMD is positioned well for the long-term. Taking together the amount of positive estimate revisions and bullish Zacks Rank, AMD is an attractive name suited for long-term investors.
Looking Forward
NVDA, OLED, and AMD have all declined significantly along with the general market. The price action we have been seeing does not line up with the reports and future expected growth.
By utilizing earnings reports and other financial data readily available, we can get a better look into how the companies are truly performing and remove the noise of the price declines.
The chip shortage and the uncertainty of the pandemic have been two of the major factors fueling the declines in not just these three tech stocks, but the majority of companies in general. I believe these times have presented investors a great opportunity to buy top-tier names at slashed prices.
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3 Discounted Microchip Stocks to Buy Now
Over the past few months in the market, some stocks have significantly declined in price and valuation. It is not just a few companies, however. The general market has experienced a lot of selling during this period. COVID’s uncertainty, supply-chain issues, and rising inflation have contributed to this.
For long-term investors, these sharp market declines have presented opportunities to purchase strong companies at a discount. Let’s take a look at three beaten down tech stocks currently trading at attractive levels that could be great additions to your long-term portfolio.
NVDA
Nvidia (NVDA - Free Report) is a worldwide leader in visual computing technologies and one of the bigger growth names in the market. Shares are down 20% year-to-date, and the chip giant has fallen roughly 40% from its all-time-high of $346 per share last November. NVDA is currently a Zacks Rank #2 (Buy) which means the majority of covering analysts expect the stock to outperform the broader market.
NVDA has a Value Style Score of F, and currently, its P/E is 47.26X. Book value per share has increased from 3.08 in 2018 to 6.03 in 2021.
Over the last 60 days, three analysts have raised their earnings outlook for fiscal 2022, and the consensus estimate has increased by six cents to $5.19 per share. Revenue is forecasted to jump in the double-digits as well, and the company’s top line should jump about 60% year-over-year to $26.7 billion in 2022. On average, NVDA has beaten earnings consensus by 7% over the last four quarters, and in their most recent report, the company beat expectations by 8.20%.
Nvidia has been affected directly by the chip shortage, which the recent negative price action reflects. However, the demand for these chips has increased significantly and Nvidia’s financial data looks rock solid with a clear path for sustained future growth. Once supply chains start working smoothly and the chip shortage has subsided, Nvidia will be ready to continue its rise. With its current price and strong Zacks Rank, I believe NVDA to be an attractive option for long-term investors.
OLED
Universal Display Corporation (OLED - Free Report) develops technology and intellectual property for the OLED (Organic Light Emitting Diodes) business. OLED is down close to 16% year-to-date and is down 47% from its all-time-high in January of 2021. OLED is currently a Zacks Rank #2 (Buy).
OLED has a Value Style Score of D and shares trade at a 27.72X forward earnings multiple. OLED’s trailing 12-month net profit margin is 35.03% compared to the industry’s average of 7%. OLED is positioned at the top of their industry and is a leader within it.
OLED has an average earnings surprise of 36.50% over the last four quarters; its most recent surprise was –11.01%. For fiscal 2021, there has been one positive earnings estimate revision and one for fiscal 2022 over the last 60 days. The consensus estimate has increased by 0.79%, or three cents, to 3.85 for fiscal 2021 over the past 60 days. OLED’s EPS is expected to grow by 37.50% for the current year and its estimated EPS long-term growth rate is 31.32% over the next three to five years.
Similar to other companies, OLED has suffered due to supply-chain constraints and the chip shortage. Price action aside, OLED has put together strong earnings reports over the last year. When combining its impressive numbers and strong Zacks Rank, OLED looks very promising for future growth and would be another attractive option for long-term investors.
AMD
Advanced Micro Devices (AMD - Free Report) develops computer processors and other similar products for both businesses and consumers. AMD shares are down nearly 23% year-to-date, and AMD has declined around 32% from its-all-time high mark of $165 per share from last November. AMD is a Zacks Rank #1 (Strong Buy).
AMD’s forward price-to-earnings ratio is 28.08X, and has increased its book value per share by $1.43 to $6.25 from 2020 to 2021. The company’s average surprise over their last four earnings reports has been 17.03% and their most recent surprise was 22.67%. Advanced Micro Devices’ full-year earnings are expected to grow 43.37% year-over-year.
Over the last 60 days, there have been 17 total positive estimate revisions for 2022 and 2023. AMD’s consensus estimate for 2022 has risen $0.72 to $4.00 per share and the estimate for 2023 has risen $0.97 to $4.77 per share, respectively.
AMD has been hit hard by the current sellers’ market. However, with extreme demand for the type of products that they produce, AMD is positioned well for the long-term. Taking together the amount of positive estimate revisions and bullish Zacks Rank, AMD is an attractive name suited for long-term investors.
Looking Forward
NVDA, OLED, and AMD have all declined significantly along with the general market. The price action we have been seeing does not line up with the reports and future expected growth.
By utilizing earnings reports and other financial data readily available, we can get a better look into how the companies are truly performing and remove the noise of the price declines.
The chip shortage and the uncertainty of the pandemic have been two of the major factors fueling the declines in not just these three tech stocks, but the majority of companies in general. I believe these times have presented investors a great opportunity to buy top-tier names at slashed prices.