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The technology sector has been a favorite among investors, known for delivering robust growth and outsized gains to shareholders. And in 2023, that’s precisely been the case, with tech stocks rebounding in a big way amid a positive shift in sentiment.
For those interested in exposure to the sector, three stocks – Meta Platforms (META - Free Report) , Vertiv (VRT - Free Report) , and NetEase (NTES - Free Report) – could all be considered. All three sport a favorable Zacks Rank and carry positive growth trajectories, a powerful combination.
Let’s take a closer look at each.
Meta Platforms
META shares have been big-time performers in its ‘year of efficiency,’ up more than 160% year-to-date and enjoying consistent post-earnings momentum. The company’s improved efficiency has led to robust quarterly results, causing analysts to revise their earnings estimates across the board.
Image Source: Zacks Investment Research
Regarding the most recent quarterly release, the company posted a positive 21% beat relative to the Zacks Consensus EPS Estimate and posted revenue 2% ahead of expectations, reflecting year-over-year growth rates of 165% and 23%, respectively.
Image Source: Zacks Investment Research
In addition, daily active users across its family of apps – Instagram, WhatsApp, Messenger, Threads, and Facebook – totaled 3.1 billion on average, climbing 7% from the year-ago period. META also continued its cost-cutting measures, with its headcount decreasing by 24% year-over-year to roughly 66k.
META shares aren’t expensive given the company’s forecasted growth, with earnings forecasted to climb 43% in its current year (FY23) on 14% higher sales. Peeking ahead a bit, FY24 consensus estimates presently suggest an additional 23% uptick in earnings paired with a 13% sales bump.
Shares presently trade at a 22.3X forward earnings multiple (F1), modestly beneath the 23.1X five-year median. Over the same five-year time period, shares have traded as high as 37.0X.
Image Source: Zacks Investment Research
NetEase
NetEase, a current Zacks Rank #1 (Strong Buy), is a Chinese internet technology company engaged in the development of applications, services, and other technologies. The revisions trend has been particularly notable for its current fiscal year, up 40% since November of last year.
Image Source: Zacks Investment Research
Keep an eye out for the company’s upcoming release expected on November 16th, as the Zacks Consensus EPS Estimate of $1.65 suggests 4% growth and has been taken 12% higher since just mid-August.
Image Source: Zacks Investment Research
In addition to technology exposure, NTES shares also pay a solid dividend, currently yielding a respectable 1.9% annually. And the company has shown a commitment to increasingly rewarding shareholders, boasting a 27% five-year annualized dividend growth rate.
Please note that the chart below is on an annual basis.
Image Source: Zacks Investment Research
Like META, the company has a bright growth outlook, with consensus estimates for its current fiscal year (FY23) suggesting 40% earnings growth paired with a 2% sales increase.
Vertiv
Vertiv is a global leader in designing, building, and servicing critical infrastructure that enables vital applications for data centers. The company is the only pure-play data center infrastructure provider able to deliver across the entire spectrum of thermal and power technologies.
Like those above, the stock sports a favorable Zacks Rank #1 (Strong Buy), with analysts bullishly revising their current year earnings estimates.
Image Source: Zacks Investment Research
Better-than-expected quarterly results have helped shares melt higher year-to-date, with the market reacting positively to each of its last three prints. In fact, Vertiv has exceeded the Zacks Consensus EPS Estimate by an average of 28% across its last four releases.
Image Source: Zacks Investment Research
It’s easy to understand why analysts have become bullish on the company, particularly when considering the long-term demand surrounding digital infrastructure as we continue to navigate the exciting artificial intelligence landscape. Currently, consensus expectations for its current year (FY23) suggest 220% earnings growth on 20% higher sales.
Bottom Line
Tech stocks have become staples in portfolios, constantly getting attention among investors thanks to their explosive growth characteristics that often lead to share outperformance.
And for those seeking a few stocks from the sector worth a look, all three above – Meta Platforms (META - Free Report) , Vertiv (VRT - Free Report) , and NetEase (NTES - Free Report) – deserve attention. All three sport a favorable Zacks Rank with positive growth trajectories, with the former reflecting bullishness among analysts.
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3 Buy-Rated Tech Stocks Boasting Bright Outlooks
The technology sector has been a favorite among investors, known for delivering robust growth and outsized gains to shareholders. And in 2023, that’s precisely been the case, with tech stocks rebounding in a big way amid a positive shift in sentiment.
For those interested in exposure to the sector, three stocks – Meta Platforms (META - Free Report) , Vertiv (VRT - Free Report) , and NetEase (NTES - Free Report) – could all be considered. All three sport a favorable Zacks Rank and carry positive growth trajectories, a powerful combination.
Let’s take a closer look at each.
Meta Platforms
META shares have been big-time performers in its ‘year of efficiency,’ up more than 160% year-to-date and enjoying consistent post-earnings momentum. The company’s improved efficiency has led to robust quarterly results, causing analysts to revise their earnings estimates across the board.
Image Source: Zacks Investment Research
Regarding the most recent quarterly release, the company posted a positive 21% beat relative to the Zacks Consensus EPS Estimate and posted revenue 2% ahead of expectations, reflecting year-over-year growth rates of 165% and 23%, respectively.
Image Source: Zacks Investment Research
In addition, daily active users across its family of apps – Instagram, WhatsApp, Messenger, Threads, and Facebook – totaled 3.1 billion on average, climbing 7% from the year-ago period. META also continued its cost-cutting measures, with its headcount decreasing by 24% year-over-year to roughly 66k.
META shares aren’t expensive given the company’s forecasted growth, with earnings forecasted to climb 43% in its current year (FY23) on 14% higher sales. Peeking ahead a bit, FY24 consensus estimates presently suggest an additional 23% uptick in earnings paired with a 13% sales bump.
Shares presently trade at a 22.3X forward earnings multiple (F1), modestly beneath the 23.1X five-year median. Over the same five-year time period, shares have traded as high as 37.0X.
Image Source: Zacks Investment Research
NetEase
NetEase, a current Zacks Rank #1 (Strong Buy), is a Chinese internet technology company engaged in the development of applications, services, and other technologies. The revisions trend has been particularly notable for its current fiscal year, up 40% since November of last year.
Image Source: Zacks Investment Research
Keep an eye out for the company’s upcoming release expected on November 16th, as the Zacks Consensus EPS Estimate of $1.65 suggests 4% growth and has been taken 12% higher since just mid-August.
Image Source: Zacks Investment Research
In addition to technology exposure, NTES shares also pay a solid dividend, currently yielding a respectable 1.9% annually. And the company has shown a commitment to increasingly rewarding shareholders, boasting a 27% five-year annualized dividend growth rate.
Please note that the chart below is on an annual basis.
Image Source: Zacks Investment Research
Like META, the company has a bright growth outlook, with consensus estimates for its current fiscal year (FY23) suggesting 40% earnings growth paired with a 2% sales increase.
Vertiv
Vertiv is a global leader in designing, building, and servicing critical infrastructure that enables vital applications for data centers. The company is the only pure-play data center infrastructure provider able to deliver across the entire spectrum of thermal and power technologies.
Like those above, the stock sports a favorable Zacks Rank #1 (Strong Buy), with analysts bullishly revising their current year earnings estimates.
Image Source: Zacks Investment Research
Better-than-expected quarterly results have helped shares melt higher year-to-date, with the market reacting positively to each of its last three prints. In fact, Vertiv has exceeded the Zacks Consensus EPS Estimate by an average of 28% across its last four releases.
Image Source: Zacks Investment Research
It’s easy to understand why analysts have become bullish on the company, particularly when considering the long-term demand surrounding digital infrastructure as we continue to navigate the exciting artificial intelligence landscape. Currently, consensus expectations for its current year (FY23) suggest 220% earnings growth on 20% higher sales.
Bottom Line
Tech stocks have become staples in portfolios, constantly getting attention among investors thanks to their explosive growth characteristics that often lead to share outperformance.
And for those seeking a few stocks from the sector worth a look, all three above – Meta Platforms (META - Free Report) , Vertiv (VRT - Free Report) , and NetEase (NTES - Free Report) – deserve attention. All three sport a favorable Zacks Rank with positive growth trajectories, with the former reflecting bullishness among analysts.