We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Top 5 Technology Services Stocks for a Solid Portfolio in 2024
Read MoreHide Full Article
The U.S. Business Services space has been benefitting from the strong fundamentals of the economy. Despite facing a record-high interest rate and extremely tight monetary control by the Fed, this sector has provided double-digit returns in the past year.
Within this sector, the technology services industry is mature, with demand for services in good shape. Revenues, income and cash flows are anticipated to gradually reach the pre-pandemic levels, aiding most industry players to pay out stable dividends.
Growth in the technology services industry has increased the number of remote workers in the wake of the pandemic. In this era of digital transformation, enterprises are actively seeking a common ground between on-premise and cloud infrastructure that will enable them to provide flexible and easy-to-adopt hybrid solutions.
The business software industry is gaining from robust demand for multi-cloud-enabled software solutions, given the ongoing transition from legacy platforms to modern cloud-based infrastructure.
The industry players are incorporating artificial intelligence and tools like machine learning in their applications to make the same more dynamic and result-oriented. Elevated demand for enterprise software, which is ramping up productivity and improving the decision-making process, is a key catalyst.
In the past year, the Zacks Defined Business Services sector has provided a double-digit return of 19.9% and the Technology Services industry has rallied an impressive 42.5%. Since it ranks within the top 25% of Zacks Ranked Industries, we expect the technology services industry to outperform the market over the next 3 to 6 months.
Our Top Picks
We have narrowed our search to five technology services stocks that have popped year to date and have solid upside left. These stocks have seen positive earnings estimate revisions in the last 30 days. Each of our picks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the price performance of our five picks in the past year.
Image Source: Zacks Investment Research
Duolingo Inc. (DUOL - Free Report) operates as a mobile learning platform in the United States, China, the United Kingdom, and internationally. DUOL offers courses in 40 different languages, including Spanish, English, French, German, Italian, Portuguese, Japanese, and Chinese through its Duolingo app. DUOL also provides a digital language proficiency assessment exam.
Duolingo has an expected revenue and earnings growth rate of 29.3% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved more than 100% over the last 60 days.
Paymentus Holdings Inc. (PAY - Free Report) provides cloud-based bill payment technology and solutions. PAY offers electronic bill presentment and payment services, enterprise customer communication, and self-service revenue management to billers and financial institutions through a software-as-a-service technology platform. PAY serves utility, financial service, insurance, government, telecommunication, and healthcare industries.
Paymentus Holdings has an expected revenue and earnings growth rate of 21% and 3.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 27.3% over the last 60 days.
LiveRamp Holdings Inc. (RAMP - Free Report) operates a data collaboration platform in the United States, Europe, the Asia-Pacific, and internationally. RAMP operates LiveRamp Data Collaboration platform, which enables an organization to unify customer and prospect data to build a single view of the customer in a way that protects consumer privacy. RAMP’s platform supports various people-based marketing solutions, including data collaboration, activation, measurement and analytics, identity, and data marketplace.
RAMP sells its solutions to enterprise marketers, agencies, marketing technology providers, publishers, and data providers in various industry verticals, such as financial, insurance and investment services, retail, automotive, telecommunications, high tech, consumer packaged goods, healthcare, travel, entertainment, and non-profit.
LiveRamp Holdings has an expected revenue and earnings growth rate of 7.7% and 54.7%, respectively, for the current year (ending March 2024). The Zacks Consensus Estimate for current-year earnings has improved more than 100% over the last 60 days.
UiPath Inc. (PATH - Free Report) provides an end-to-end automation platform that offers a range of robotic process automation solutions primarily in the United States, Romania, and Japan. PATH offers a suite of interrelated software to build, manage, run, engage, measure, and govern automation within the organization. PATH’s platform combines artificial intelligence with desktop recording, back-end mining of both human activity and system logs, and intuitive visualization tools.
UiPath has an expected revenue and earnings growth rate of 18.9% and 5.8%, respectively, for the current year (ending January 2025). The Zacks Consensus Estimate for current-year earnings has improved 8.9% over the last 60 days.
Spotify Technology S.A. (SPOT - Free Report) provides audio streaming services worldwide. SPOT operates through two segments, Premium and Ad-Supported. The Premium segment offers unlimited online and offline streaming access to its catalog of music and podcasts without commercial breaks to its subscribers.
The Ad-Supported segment provides on-demand online access to its catalog of music and unlimited online access to the catalog of podcasts to its subscribers on their computers, tablets, and compatible mobile devices. SPOT also offers sales, distribution and marketing, contract research and development, and customer support services.
Spotify Technology has an expected revenue and earnings growth rate of 17.3% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 8.5% over the last 30 days.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Top 5 Technology Services Stocks for a Solid Portfolio in 2024
The U.S. Business Services space has been benefitting from the strong fundamentals of the economy. Despite facing a record-high interest rate and extremely tight monetary control by the Fed, this sector has provided double-digit returns in the past year.
Within this sector, the technology services industry is mature, with demand for services in good shape. Revenues, income and cash flows are anticipated to gradually reach the pre-pandemic levels, aiding most industry players to pay out stable dividends.
Growth in the technology services industry has increased the number of remote workers in the wake of the pandemic. In this era of digital transformation, enterprises are actively seeking a common ground between on-premise and cloud infrastructure that will enable them to provide flexible and easy-to-adopt hybrid solutions.
The business software industry is gaining from robust demand for multi-cloud-enabled software solutions, given the ongoing transition from legacy platforms to modern cloud-based infrastructure.
The industry players are incorporating artificial intelligence and tools like machine learning in their applications to make the same more dynamic and result-oriented. Elevated demand for enterprise software, which is ramping up productivity and improving the decision-making process, is a key catalyst.
In the past year, the Zacks Defined Business Services sector has provided a double-digit return of 19.9% and the Technology Services industry has rallied an impressive 42.5%. Since it ranks within the top 25% of Zacks Ranked Industries, we expect the technology services industry to outperform the market over the next 3 to 6 months.
Our Top Picks
We have narrowed our search to five technology services stocks that have popped year to date and have solid upside left. These stocks have seen positive earnings estimate revisions in the last 30 days. Each of our picks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the price performance of our five picks in the past year.
Image Source: Zacks Investment Research
Duolingo Inc. (DUOL - Free Report) operates as a mobile learning platform in the United States, China, the United Kingdom, and internationally. DUOL offers courses in 40 different languages, including Spanish, English, French, German, Italian, Portuguese, Japanese, and Chinese through its Duolingo app. DUOL also provides a digital language proficiency assessment exam.
Duolingo has an expected revenue and earnings growth rate of 29.3% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved more than 100% over the last 60 days.
Paymentus Holdings Inc. (PAY - Free Report) provides cloud-based bill payment technology and solutions. PAY offers electronic bill presentment and payment services, enterprise customer communication, and self-service revenue management to billers and financial institutions through a software-as-a-service technology platform. PAY serves utility, financial service, insurance, government, telecommunication, and healthcare industries.
Paymentus Holdings has an expected revenue and earnings growth rate of 21% and 3.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 27.3% over the last 60 days.
LiveRamp Holdings Inc. (RAMP - Free Report) operates a data collaboration platform in the United States, Europe, the Asia-Pacific, and internationally. RAMP operates LiveRamp Data Collaboration platform, which enables an organization to unify customer and prospect data to build a single view of the customer in a way that protects consumer privacy. RAMP’s platform supports various people-based marketing solutions, including data collaboration, activation, measurement and analytics, identity, and data marketplace.
RAMP sells its solutions to enterprise marketers, agencies, marketing technology providers, publishers, and data providers in various industry verticals, such as financial, insurance and investment services, retail, automotive, telecommunications, high tech, consumer packaged goods, healthcare, travel, entertainment, and non-profit.
LiveRamp Holdings has an expected revenue and earnings growth rate of 7.7% and 54.7%, respectively, for the current year (ending March 2024). The Zacks Consensus Estimate for current-year earnings has improved more than 100% over the last 60 days.
UiPath Inc. (PATH - Free Report) provides an end-to-end automation platform that offers a range of robotic process automation solutions primarily in the United States, Romania, and Japan. PATH offers a suite of interrelated software to build, manage, run, engage, measure, and govern automation within the organization. PATH’s platform combines artificial intelligence with desktop recording, back-end mining of both human activity and system logs, and intuitive visualization tools.
UiPath has an expected revenue and earnings growth rate of 18.9% and 5.8%, respectively, for the current year (ending January 2025). The Zacks Consensus Estimate for current-year earnings has improved 8.9% over the last 60 days.
Spotify Technology S.A. (SPOT - Free Report) provides audio streaming services worldwide. SPOT operates through two segments, Premium and Ad-Supported. The Premium segment offers unlimited online and offline streaming access to its catalog of music and podcasts without commercial breaks to its subscribers.
The Ad-Supported segment provides on-demand online access to its catalog of music and unlimited online access to the catalog of podcasts to its subscribers on their computers, tablets, and compatible mobile devices. SPOT also offers sales, distribution and marketing, contract research and development, and customer support services.
Spotify Technology has an expected revenue and earnings growth rate of 17.3% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 8.5% over the last 30 days.