Tech stocks continue to face a period of increased volatility this year after almost a decade of taking the lead in market expansion since March 2009.
Concerns regarding increased regulatory pressure, inflated stock valuations, and a downturn in the once-hot chip industry as well as slowing corporate earnings growth have dragged numerous technology stocks into correction territory.
Nevertheless, several market leaders prevailed, with top tech stock almost doubling their value in a short time period.
Looking ahead, some analysts are projecting tougher times for technology giants, suggesting that investors seek more defensive names and revert to value plays. Some view the sequence of sell-offs as a chance to purchase high-growth technology stocks at a discount prior to a rebound this year.
More significant in this industry such as machine learning, open-source software, the Internet of Things (IoT), bigger spending on enterprise software and autonomous vehicles are viewed as growth drivers this year.
Top Rated Tech Stocks
The following tech companies are leading the pack and have posted jaw-dropping gains so far this year. In spite of a volatile market, these stocks have managed to outperform in notable ways.
Avalara Inc
Ticker: (NYSE: AVLR)
YTD Performance: 112%
Avalara Inc offers a cloud-based software platform that provides solutions linked to value-added tax and sales tax. Avalara rationalizes all tax compliance documentation among users into central repository accountability and access. It provides effortless reporting, painless administration, accurate tax compliance, and transparent transactions.
Besides, it operates within a point of sale system, e-commerce, billing, and a customer’s financing to deliver tax calculations in real time through an internet connection.
In addition, this company’s products include Avalara AvaTax, which provides an automated end-to-end tax compliance solution to users, Avalara Returns, which fosters end-to-end automation to sales tax compliance process, Avalara CertCapture which makes it possible for users to justify, manage and track non-taxable transactions.
Sales tax notices and responses with requested information are managed by Avalara Returns. It automatically offers excise tax returns, streamlined sales tax, hard-copy an e-file for enterprises of all sizes. Early this month, Avalara shares marked $81.78 per share against a previous $81.62 closing price.
With its YTD performance, Avalara showed a rise of 162.54%, with highs and lows of $28.09 to $94.31 during the 52 weeks period.
Perficient
Ticker: (Nasdaq: PRFT)
YTD Performance: 67%
Perficient, Inc is a consulting firm serving customers throughout North America. Its efforts include platform implementations, custom development, management consulting, information technology, Internet of Things, digital strategy, marketing, creative services, and mobile enterprise applications.
This company principally performs project-based work, portal collaboration, and business intelligence. Besides, it has offshore capabilities and has offices in China, India, Europe, and North America.
According to analysts, the average twelve-month price target is $38.75, hinting that the stock has a possible upside of 4.25%. The low price target is $30.00, and the high price target is $44.00. With a current price is $37.13, Perficient stocks has potential for some decent returns.
The long term earning potential is +18.59% in one year with a future stock price of $69.683. The success of this company is attributed to a deepened and broadened digital marketing, automated services capabilities, exemplary customer service and follow on projects with leading companies such as Ashley Furniture, Excellus BSBS, PayPal, trinity Health and Auto Club Group.
Pegasystems
Ticker (Nasdaq: PEGA)
YTD Performance: 47%
Pegasystems is a market leader in software aimed at promoting digital reform. The company takes pride in a 35-year history of assisting the world’s top organizations in attaining revolutionary business outcomes. In addition, the firm transforms how key corporations foster customer experience as well as the automation of operations.
Pegasystems operates in the sector of technology and the EDP Services industry. Its 1 Year Target is $83.00, and so far, the stock has experienced a high of $70.10 and a low of $68.64.
Presently, the stock is at $69.84 with a previous close of $69.80. The earnings per share in the next quarter (December 2019) is projected to be 0.39, and in the next year (2020), 0.43.
Analysts indicate that $PEGA has a 1.5 recommendation rating which is within the category of a strong buy. Moreover, they affirm the price targets to be $85.25 on average, which is a significant increase from the current price.
The success of Pegasystems can be linked to its desire to change the world’s creation of software. An analyst report indicates that the corporation has been termed a “leader in Gartner’s Magic Quadrant for CRM Customer Engagement Center” for ten years in a row.
In view of that, the venture helps organizations interact with their customers through the platform of their choice, including SMS, email, chat, and web. This stock is certainly worth considering.
Digi International
Ticker: (Nasdaq: DGII)
YTD Performance: 33%
From 1985, Digital International Inc. has been a forerunner in wireless communication, building the future for connected gadgets and acting in response to the needs of the enterprises and individuals that adopt them. In an effort to keep up with the emerging technologies, the company offers a multifaceted platform for the remote assessment of device deployments regardless of size and location.
Analysts state that DIGI’s sales in the current quarter (September 2019) are at 65.66M and 228.37M this year. The EPS trend is quite remarkable: 0.06 in the current quarter, 0.07 in the next quarter and 0.33 this year. Next year, it is anticipated to increase to 0.47.
Additionally, this tech stock has a market cap of 389,691,190, a share volume of 90,776, and a 50-day average volume of 106,017. The previous close was $13.63, and as of September 25 this year, the stock’s price increased to $13.85.
Moreover, the analysts recommend that DIGI has a 1.4 buy rating and note that the average of the price targets is 17.43. With this in mind, traders need to look out for this stock as its performance currently good, and its future is more promising.
Partners such as VesCo Solutions chose Digi International to be well informed with their projects’ connectivity. This is because promoting transformation in business is a compelling driving force to Digi’s amazing portfolio.
Echo Star Corp.
Ticker (Nasdaq: SATS)
YTD Performance: 45%
This corporation is a leading worldwide supplier of satellite communication solutions. With its headquarters in Englewood, Colorado, EchoStar conducts its businesses across the globe through its business segments. These include EchoStar Satellite Services and Hughes Network Systems. In addition, the firm provides innovative and dependable solutions- to the satellite sector.
At the close of September 26, the company’s stock was worth 40.22 with a previous close of 40.31. The firm’s market cap is ay 3.91B with a bid, and an ask rate of 40.20 x 900 and 43.56 x 900 respectively. While the Day’s Range is 39.83 – 40.30, the 52 Week Range is 27.22 – 41.32.
The stock’s target estimate for one year is 54.40, and the share’s growth is predicted to amplify significantly from 82.40% in the current quarter to 144.80% in the next quarter. Analysts propose that SATS has a buying rate of 1, which is a strong buy. In accordance to that, investors can pay special attention to this tech company that is performing well.
EchoStar’s shining star is illuminated by various aspects, including its distribution partners’ expression of substantial interest in lower-cost mobile innovations.
Over time, it is expected that the venture‘s mobile services and products will be incorporated into a contemporary international hybrid network that will be a bargaining chip for terrestrial and satellite technologies. With such plans in place, this tech stock can capture the minds and hearts of many investors.
Final Thoughts
Early this year, the technology space was destabilized by a reclassification of some huge companies into another industry category. Tech stocks such as Facebook Inc. (FB) and Alphabet Inc. (GOOGL) have shifted from Technology to the Communications Services sector. Customer experience, mobile-first and digital transformations are modern imperatives of this era.
Tech stocks have over the years been viewed as massive wealth creators. These stocks have a high beta, meaning they outshine indices in a bull run but are also prone to volatility in a downturn.
Currently, technology stocks are popular, and analysts predict a positive trend in the future. These stocks have a positive outlook, hence a good addition to one’s portfolio. In the first half of 2019, technology stocks continue to lead, on a year-to-date basis.
Fruitful Trading!