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2 Tech Stocks to Consider Buying as Earnings Approach
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Among the Zacks Computer and Technology sector, a few intriguing software companies will be reporting earnings this week.
Furthermore, currently in top-rated Zacks industries here are two of these highly-ranked tech stocks that investors may want to consider buying before their fourth-quarter earnings reports.
Reporting its Q4 earnings on Wednesday, March 1, Salesforce is standing out with CRM stock sporting a Zacks Rank #2 (Buy) and its Computer-Software Industry is currently in the top 35% of over 250 Zacks Industries.
To that note, earnings estimate revisions have nicely gone up for fiscal 2023 and FY24. Fiscal 2023 earnings estimates have increased by 4% over the last 60 days and FY24 EPS estimates have gone up 6% in the last 90 days.
Image Source: Zacks Investment Research
Q4 Preview & Outlook
Salesforce Q4 earnings are expected at $1.36 per share, up a stellar 62% from EPS of $0.84 in Q4 2022. On the top line, fourth-quarter sales are expected to be $7.99 billion, a 9% increase from the prior year quarter.
Salesforce is now expected to round out Fiscal 2023 with EPS up 3% and FY24 earnings are expected to jump another 19% to $5.86 a share. Total sales are now forecasted to climb 17% in FY23 and rise another 10% in FY24 to $34.15 billion. More impressive, fiscal 2024 would represent an outstanding 157% growth from pre-pandemic levels with 2019 sales at $13.28 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Salesforce stock is up +23% year to date, despite still being down -23% over the last year to underperform the S&P 500’s -10% and the Nasdaq’s -16%. However, in the last decade since Salesforce went public, CRM is now up +257% to easily top the benchmark and roughly match the Nasdaq.
Image Source: Zacks Investment Research
Last year’s drop may have certainly been a long-term buying opportunity looking at Salesforce’s historical valuation and forecasted bottom-line growth. Trading at $163 per share, CRM trades at 51.1X forward earnings but this is well below its decade-long high of 812.3X and 64% beneath the median of 144.1X with the rising EPS estimates offering further support.
Splunk )
Another tech stock that looks intriguing going into its Q4 earnings report on March 1 is Splunk. The software solutions provider also sports a Zacks Rank #2 (Buy) and its Internet-Software Industry is currently in the top 33% of all Zacks Industries.
Earnings estimates revisions have significantly gone up for Splunk’s FY23 and FY24. Impressively, fiscal 2023 earnings estimates have gone up 79% throughout the quarter and FY24 EPS estimates have risen 46%.
This is a great sign that companies are continuing to rely on Splunk for real-time operations intelligence and to harness the value of their data. Splunk allows businesses to investigate, monitor, analyze, and act on machine data, and big data (irrespective of format or source) which assists with operational decision-making.
Image Source: Zacks Investment Research
Q4 Preview & Outlook
The Zacks Consensus for Splunk’s’ Q4 earnings is $1.11 per share, which would be a 68% increase year over year. Sales for the quarter are expected to be $1.07 billion, up 19% YoY.
Rounding out its fiscal year 2023, Splunk earnings are now forecasted to climb to $1.80 a share compared to EPS of -$1.25 in 2022. Plus, fiscal 2024 earnings are expected to leap another 42% at $2.56 per share.
Sales are now projected to jump 30% in FY23 and rise another 15% in FY24 to $3.99 billion. Fiscal 2024 would be a 119% increase from pre-pandemic levels with 2019 sales at $1.80 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Splunk stock has rallied +19% YTD to largely outperform the broader indexes. Over the last year, SPLK’s -13% drop has trailed the S&P 500’s -11% but beat the Nasdaq’s -16%. Furthermore, Splunk is now up +163% over the last decade to trail the Nasdaq but top the benchmark.
Image Source: Zacks Investment Research
Trading at $101 per share, Splunk stock trades at 39.8X forward earnings. While Splunk does not have a traditional P/E history to compare, its forward earnings are below the industry average of 41.6X.
Plus, Splunk’s PEG ratio is getting closer to the optimum level of less than 1 at 1.33 which is also beneath the industry average of 1.78 and shows the company’s growth rate is favorable in conjunction with its valuation. Splunk’s stock currently sports an “A” Style Scores grade for Growth.
Bottom Line
Rounding out their fiscal 2023, Salesforce and Splunk are two tech stocks that investors should consider buying as the rising earnings estimates revisions for fiscal 2024 indicates there could be more upside to their stellar year-to-date performances. In this regard, Both CRM and SPLK stock could soar even more if the companies can provide strong Q4 reports and guidance that reaffirms the rising earnings estimates.
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2 Tech Stocks to Consider Buying as Earnings Approach
Among the Zacks Computer and Technology sector, a few intriguing software companies will be reporting earnings this week.
Furthermore, currently in top-rated Zacks industries here are two of these highly-ranked tech stocks that investors may want to consider buying before their fourth-quarter earnings reports.
Salesforce (CRM - Free Report) )
Reporting its Q4 earnings on Wednesday, March 1, Salesforce is standing out with CRM stock sporting a Zacks Rank #2 (Buy) and its Computer-Software Industry is currently in the top 35% of over 250 Zacks Industries.
To that note, earnings estimate revisions have nicely gone up for fiscal 2023 and FY24. Fiscal 2023 earnings estimates have increased by 4% over the last 60 days and FY24 EPS estimates have gone up 6% in the last 90 days.
Image Source: Zacks Investment Research
Q4 Preview & Outlook
Salesforce Q4 earnings are expected at $1.36 per share, up a stellar 62% from EPS of $0.84 in Q4 2022. On the top line, fourth-quarter sales are expected to be $7.99 billion, a 9% increase from the prior year quarter.
Salesforce is now expected to round out Fiscal 2023 with EPS up 3% and FY24 earnings are expected to jump another 19% to $5.86 a share. Total sales are now forecasted to climb 17% in FY23 and rise another 10% in FY24 to $34.15 billion. More impressive, fiscal 2024 would represent an outstanding 157% growth from pre-pandemic levels with 2019 sales at $13.28 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Salesforce stock is up +23% year to date, despite still being down -23% over the last year to underperform the S&P 500’s -10% and the Nasdaq’s -16%. However, in the last decade since Salesforce went public, CRM is now up +257% to easily top the benchmark and roughly match the Nasdaq.
Image Source: Zacks Investment Research
Last year’s drop may have certainly been a long-term buying opportunity looking at Salesforce’s historical valuation and forecasted bottom-line growth. Trading at $163 per share, CRM trades at 51.1X forward earnings but this is well below its decade-long high of 812.3X and 64% beneath the median of 144.1X with the rising EPS estimates offering further support.
Splunk )
Another tech stock that looks intriguing going into its Q4 earnings report on March 1 is Splunk. The software solutions provider also sports a Zacks Rank #2 (Buy) and its Internet-Software Industry is currently in the top 33% of all Zacks Industries.
Earnings estimates revisions have significantly gone up for Splunk’s FY23 and FY24. Impressively, fiscal 2023 earnings estimates have gone up 79% throughout the quarter and FY24 EPS estimates have risen 46%.
This is a great sign that companies are continuing to rely on Splunk for real-time operations intelligence and to harness the value of their data. Splunk allows businesses to investigate, monitor, analyze, and act on machine data, and big data (irrespective of format or source) which assists with operational decision-making.
Image Source: Zacks Investment Research
Q4 Preview & Outlook
The Zacks Consensus for Splunk’s’ Q4 earnings is $1.11 per share, which would be a 68% increase year over year. Sales for the quarter are expected to be $1.07 billion, up 19% YoY.
Rounding out its fiscal year 2023, Splunk earnings are now forecasted to climb to $1.80 a share compared to EPS of -$1.25 in 2022. Plus, fiscal 2024 earnings are expected to leap another 42% at $2.56 per share.
Sales are now projected to jump 30% in FY23 and rise another 15% in FY24 to $3.99 billion. Fiscal 2024 would be a 119% increase from pre-pandemic levels with 2019 sales at $1.80 billion.
Image Source: Zacks Investment Research
Performance & Valuation
Splunk stock has rallied +19% YTD to largely outperform the broader indexes. Over the last year, SPLK’s -13% drop has trailed the S&P 500’s -11% but beat the Nasdaq’s -16%. Furthermore, Splunk is now up +163% over the last decade to trail the Nasdaq but top the benchmark.
Image Source: Zacks Investment Research
Trading at $101 per share, Splunk stock trades at 39.8X forward earnings. While Splunk does not have a traditional P/E history to compare, its forward earnings are below the industry average of 41.6X.
Plus, Splunk’s PEG ratio is getting closer to the optimum level of less than 1 at 1.33 which is also beneath the industry average of 1.78 and shows the company’s growth rate is favorable in conjunction with its valuation. Splunk’s stock currently sports an “A” Style Scores grade for Growth.
Bottom Line
Rounding out their fiscal 2023, Salesforce and Splunk are two tech stocks that investors should consider buying as the rising earnings estimates revisions for fiscal 2024 indicates there could be more upside to their stellar year-to-date performances. In this regard, Both CRM and SPLK stock could soar even more if the companies can provide strong Q4 reports and guidance that reaffirms the rising earnings estimates.