Top Tech Growth Stocks To Buy: Rapid expansion of the internet, the phenomenal popularity of smartphones and the meteoric rise of e-commerce and software-as-a-service businesses have made technology sector the darling of investors.
No wonder it continues to outperform all others over the last couple of decades and the trend is likely to continue in the foreseeable future.
There’s every possibility that technology companies will continue to lead the market with technological sophistication and innovative breakthroughs. Keeping this in mind, we present the top tech growth stocks that should be on your radar.
#10 Slack Makes Teams More Productive
San Francisco, California-based Slack Technologies, Inc. [NYSE: WORK] designs and develops communication platforms which enable real-time messaging, file sharing, archiving, and searching services for organizations.
Slack was founded in 2009 and went public on the New York Stock Exchange via a direct stock listing in June 2019.
Trading volume was light during July and August but it has increased in September and October, indicating investor interest in Slack Technologies, Inc. is picking up.
Shares of Slack [NYSE: WORK] amazed investors at its debut, surging more than $41 in the initial hours of trading. However, the prices soon witnessed a downward trend – Slack stocks lost altitude as concerns grew among investors about the company’s slowing revenue.
Shares tumbled more than 11% in July as Microsoft [NASDAQ: MSFT] Teams, Slack’s closest competitor, bettered Slack in number of users.
Slack operates a cloud-based real-time collaboration platform and has a loyal customer base but so far that fan base hasn’t halted a precipitous slide in Slack share price.
The company’s fast growth has cost it in Net Margin, which is negative. Currently profitability is taking a back seat to growth, which is arguably a wise strategy as the friction is high among customers to leave once onboarded.
The company’s financial data has both positives and negatives, but the biggest threat remains the competitive threat from Microsoft.
#9 Okta Creates Single Entry Logins
Okta, Inc [NASDAQ: OKTA] is a San Francisco, California-based identity and access management company which provides enterprise-grade identity management services for small and medium-sized businesses, universities, non-profits, and government agencies in the United States and internationally.
Okta sells six services, including a single sign-on solution that enables users to access their applications in the cloud or on premise from various devices using one centralized process. For example, the company claims the ability to log into Gmail, Workday, Salesforce and Slack with a single entry of their user credentials.
Okta Inc. [NASDAQ: OKTA] posted its quarterly earnings data on Wednesday, August 28th. The company reported $0.32 earnings per share (EPS) for the quarter, matching analysts’ consensus estimate. The company garnered $0.15 EPS during the same quarter last year.
The technology company earned $140.48 million during the quarter, comfortably beating analyst estimates of $131.19 million.
However, Okta had a negative return on equity of 53.93% and a negative net margin of 31.90%, indicating this company is not generating as much profit as its peers.
Like Slack, Okta is prioritizing growth over profitability. The firm’s quarterly revenue was up 48.5% on a year-over-year basis.
Okta, Inc. [OKTA] has 116.65M shares outstanding, amounting to a total market cap north of $12Bn. Its stock price has hit a 52-week low of $41.88 and a 52-week high of $141.85.
Its Quick and Current Ratio is 1.21, which indicates a healthy ratio between its short-term liquid assets and its short-term liabilities.
Analysts are upbeat about Okta’s stock price, expecting it to reach $132.00 in the next year. This suggests a possible surge of over 20% from the stock’s current price, which could make Okta a buy.
#8 The Trade Desk Optimizes Ad Campaigns
The Trade Desk, Inc. [NASDAQ: TTD] operates as an advertising technology company. The Ventura, California-based company offers a self-service online advertising platform for managing data-driven digital ad campaigns.
The company, co-founded in 2009 by Jeff Green, who is currently Chairman and CEO and Dave Pickles, CTO, delivers the technology and data to create personalized ad experiences and help marketers streamline their TV and digital media strategies.
The company first traded on NASDAQ on September 21, 2016. The IPO price was $18 per share.
Shares of The Trade Desk, Inc. [TTD], overall, offer a lucrative investment opportunity. The company makes good use of its capital and other resources. Its Quick Ratio is 1.48 and its Current Ratio is 1.48. This shows that the company is solidly placed to service its short-term liabilities, making it a less risky investment.
The Trade Desk, Inc. [TTD] has 44.98M shares outstanding, amounting to a total market cap in the billions. Analysts expect its price to move northwards in the next 12 months.
This stock’s Relative Strength Index (RSI) is at 42.47, which suggests the stock is neither overbought nor undervalued. Traditionally, the RSI is considered overbought, when above 70 and oversold or undervalued when below 30.
While it has heavy Long-Term Debt to Equity, the majority of the metrics send a positive signal, emphasizing that The Trade Desk stock should be on your radar.
#7 ServiceNow Cloud Computing Wins Customers
ServiceNow, Inc. [NYSE: NOW] is an American cloud computing company which provides enterprise cloud computing solutions that define, structure, manage, and automate services for enterprises worldwide.
The company also provides professional services, training services and certification programs, and customer support services. The company was founded by Frederic B. Luddy in June 2004 and is headquartered in Santa Clara, CA.
ServiceNow Inc [NYSE: NOW] released its quarterly earnings results on Wednesday, October, 23rd. ServiceNow reported $0.99 earnings per share (EPS) for the quarter, exceeding analysts’ estimate of $0.18 by a fair margin. This tops the $0.68 EPS the company earned in the same period last year.
The information technology services provider earned $885.80 million during the quarter, compared to analyst expectations of $885.53 million.
ServiceNow had a net margin of 1.10% and a return on equity of 6.62%. The company’s revenue was up 31.6% compared to the same quarter last year and generates $2.61 billion in revenue each year.
The 52-week high currently stands at $303.17, at a sizeable distance from the latest closing price of $247.26. Its 52-week low has been $147.63.
ServiceNow shares are up 28% since the beginning of the year. Management expects $3.240 billion to $3.245 billion in subscription revenue for all of 2019.
Estimates for 12-month price forecasts for ServiceNow range from $199.00 to $334.00. On an average, analysts anticipate ServiceNow stock price to reach $290.82 in the next year. This suggests a gain of over 20% from its present value, making it a strong buy candidate.
#6 Atlassian Corporation Workflows Are World Class
Atlassian Corporation Plc [NASDAQ: TEAM] is an Australian enterprise software company that develops designs, licenses, and maintains various software products worldwide.
It is best known for its issue tracking application, JIRA, a workflow management system that enables teams to plan, organize, track, and manage their work and projects in order to keep themselves aligned and on track: and Confluence, a content collaboration platform that is used to create, share, organize, and discuss projects.
The company, founded by Mike Cannon-Brookes and Scott Farquhar in 2002, went public on the NASDAQ stock exchange on December 10, 2015.
Atlassian [NASDAQ: TEAM] released its quarterly earnings data on Thursday, October 17th. The software company reported $0.28 earnings per share for the quarter, surpassing the consensus estimate of $0.24 by $0.04. The company had posted $0.20 earnings per share in the same period last year.
Atlassian reported revenues of $363.40 million for the quarter, beating analyst estimate of $351.79 million. However, it had a negative return on equity of 2.76% and a net margin of -24.95%, casting doubts on its profit generating abilities.
Nevertheless, the firm’s revenue for the quarter was up 36% from the $267.3 million it generated in the corresponding period a year before.
Atlassian Corporation Plc [TEAM] has 242.91M shares outstanding, amounting to a total market cap of almost $30Bn. Its stock price has been found in the range of 65.17 to 149.80.
For risk-seeking investors, this stock’s Beta value is currently 1.42, which indicates a higher level of volatility.
Technically speaking, the stock’s Relative Strength Index (RSI) is at 29.38, which makes it undervalued.
Fundamentally, its Quick and Current Ratio is 0.93, which makes it a riskier investment.
Wall Street analysts seem to be bullish on the company having set a 1-year target price of $142.27 for Atlassian’s share price.
Despite a tepid response from the market and higher volatility, the company has performed well and is poised for good, long-term growth, making it potentially a wise investment option.
#5 JD.com Is Crushing Online Retail In China
JD.com [NASDAQ: JD], also known as Jingdong and formerly called 360buy, is China’s largest online retailer and its biggest overall retailer, as well as the country’s largest internet company by revenue.
It is one of the two massive B2C online retailers in China by transaction volume and revenue, a member of the Fortune Global 500 and a major competitor to Alibaba-run Tmall was listed on NASDAQ in the United States in May 2014.
JD.Com Inc. [NASDAQ: JD] issued its quarterly earnings data on Tuesday, August 13th. The Chinese conglomerate reported $0.23 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.05 by $0.18.
The online direct sales company earned $150.28 billion during the quarter, compared to the consensus estimate of $147.44 billion. Its revenue jumped up 22.9% compared to the same quarter last year.
This stock’s Beta value is currently 1.43, which indicates volatility more than there is in the wider market.
For technicians, this stock’s Relative Strength Index (RSI) is at 51.18. JD.com’s RSI score suggests this stock is neither overbought nor oversold.
JD.com [JD] is expected to report its Q3 earnings on Friday, November 15, 2019. Consensus expects RMB 128bn in revenue and RMB1.20/share in EPS.
JD.com has evoked mixed sentiments from analysts. Wall Street analysts’ have set 1-year price to reach $33.56. The price performance of shares has not shown much promise, which somewhat reduces its appeal as an attractive investment opportunity but the scale of its revenues and customer base make it hard to overlook, particularly as it is tethered to Chinese growth in coming years.
#4 Alibaba Beats Amazon and Ebay In Revenues
Alibaba Group Holding Ltd [NYSE: BABA], through its subsidiaries, operates as an online and mobile commerce company in China and internationally. The Chinese online retail giant handles more business than any other e-commerce company.
The company, which was founded in 1999 and is based in Hangzhou, operates in four key segments:
- Core Commerce,
- Cloud Computing,
- Digital Media and Entertainment, and
- Innovation Initiatives.
The Chinese internet behemoth has three main sites — Taobao, Tmall and Alibaba.com. These three together boast of hundreds of millions of users, and host millions of merchants and businesses.
Alibaba [NYSE: BABA] posted its quarterly earnings results for the quarter ended September 30, 2019, on Friday, November, 1st. The most popular destination for online shopping in China reported adjusted earnings of $1.83 per share on revenue of $16.65 billion, topping consensus estimate of earnings of $1.51 per share on revenue of $16.47 billion.
The China e-commerce giant had a net margin of 34.02% and a return on equity of 15.45%. The better-than-expected fiscal second-quarter results came as a result of a stellar performance by the cloud computing division whose revenue soared 64% to $1.3 billion.
Core commerce revenue growth stood at 40%. The company with 2.61B shares outstanding has a market value of $482Bn.
This stock’s Beta value is currently 1.25, which indicates slight volatility. This stock’s Relative Strength Index (RSI) is at 48.12, indicating the stock is neither overbought nor oversold.
Alibaba has frequently beaten consensus estimates on EPS and revenue. Analysts’ forecasts range from $200.00 to $280.00.
On average, they expect its price to rise considerably in the next 12 months, reaching around $225.78. This suggests a possible upside of 22.9% from the stock’s current price, making it an attractive buy.
#3 Match Group Owns Online Dating
Match Group, Inc. [NASDAQ: MTCH] is an American Internet company that owns and operates a portfolio of brands including OkCupid, PlentyOfFish, Tinder, Hinge and Match.com.
Match Group offers its dating products through its applications and websites in approximately 40 languages. The Dallas, Texas-based company was incorporated in 2009 and went public on November 19, 2015, and trades on NASDAQ with the ticker symbol MTCH.
Match Group reported $1.7 billion in revenue for the year 2018 and has a $15.7 billion market cap which could potentially be significantly undervalued when you consider it has a virtual monopoly when it comes to online dating.
Match Group Inc. [NASDAQ: MTCH] issued its quarterly earnings results on Tuesday, November 5th. The technology company reported $0.51 earnings per share (EPS) for the quarter, beating consensus estimate of $0.42 by $0.09. It posted $0.44 earnings per share in the same period last year.
Match Group earned $541.50 million during the quarter, compared to analysts’ expectations of $540.73 million. Revenue for the quarter was up 22.0% on a year-over-year basis.
Match Group had a return on equity of 166.69% and a net margin of 26.51%, which indicates it is generating considerably more profit after the expenses are accounted for, compared to its market peers.
Fundamentally, its Quick and Current Ratio is 1.32, which indicates it is comfortably placed to meet its short-term obligations.
This stock’s Beta value is currently 1.17, which indicates that it is slightly volatile. The stock’s Relative Strength Index (RSI) is at 38.91, which suggests the stock is neither overbought nor oversold.
Match stock price has been found in the range of 31.69 to 95.30 while it had the best day in its history on August 7, 2019, surging by as much as 29% to scale new heights riding on Tinder’s paid subscriber growth. Its latest closing price stood at $67.04.
Wall Street analysts have mixed reviews when it comes to the 12-month price outlook. On an average, they anticipate Match Group’s share price to be around $90.00 over the next twelve months. The bottom line is if you believe online dating will continue to be popular, Match is perfectly positioned to benefit.
#2 Shopify Is The E-Commerce Platform
Shopify Inc. [NYSE: SHOP] is a Canadian multinational e-commerce company which offers a cloud-based, multi-channel commerce platform designed to help individuals and small businesses set up shop online and build their brands.
Merchants can use the software to design, set up, and manage their stores across multiple sales channels, including web, mobile, social media, marketplaces, brick-and-mortar locations, and pop-up shops.
The Ottawa, Ontario, Canada-based company founded in 2004 offers online retailers a suite of services including marketing, customer engagement, payments, and shipping tools to simplify the process of running an online store.
Shopify currently processes millions of individual sales by thousands of merchants every year in more than 170 countries.
The company went public on the New York Stock Exchange on May 21, 2015, with its IPO raising more than $131 million.
Shopify Inc. reported an unexpected quarterly loss as the Canadian e-commerce company increased spending to build out a network of fulfillment centers across the U.S. to help merchants using its platform in less time and at a cheaper price.
The stock tumbled as much as 8.1% to $298.64 as the market opened in New York on 2019-11-06. Shopify’s share price has wilted by about 20% since August, with investors taking to profit booking.
It hit a record high on Aug. 27, having surged continuously for eight months. Shopify Inc. [NYSE: SHOP] has witnessed a 52-week low of $117.64 and a high of $409.61.
In the three months ending Sept. 30, the adjusted loss per share was 29 cents, in comparison to earnings per share of 5 cents in the corresponding period last year. Analysts were expecting earnings of 10 cents per share.
In the third quarter, revenue grew 45% to $390.6 million, beating analysts’ average estimate of $383.8 million. Shopify boosted its 2019 revenue guidance from $1.55 billion to $1.56 billion and increased its fourth-quarter sales estimate to as much as $482 million.
SHOP is forecast to become profitable over the next 3 years, which is considered above average market growth. Shopify stock has a near-perfect 98 RS Rating. In other words, its performance is in the top 2% of all stocks over the past year.
Despite tech giants looming as threats, Shopify stock has delivered a stellar performance. Analysts say the company could triple its market share to about 9% within five years. Based on current forecasts, a long-term increase is expected in the e-commerce platform provider’s stock price.
#1 Alphabet Stock: Google, YouTube, Android…
Alphabet Inc. [NASDAQ: GOOG] operates as a holding company. It was created through a corporate restructuring of Google and its subsidiaries on October 2, 2015. The idea was to allow Google to remain focused on things related to its mission while allowing business units to operate independently and expand into new areas.
Alphabet Inc. [NASDAQ: GOOG] share price has witnessed a 52-week low of $977.66 and a high north of $1,300 having surged by double digit percentage levels.
The company which owns YouTube, Google Cloud, Android, Chrome, and Google Play, and Nest among other businesses is closing in on a trillion dollar market capitalization with a strong tailwind of growth continuing to bolster its financials.
Alphabet Inc. Net Margin is over 23%, which shows the company is generating better profits than its peers.
For “nervous nellys” though the stock can be a wild ride sometimes. Its Beta value is 1.42, indicating the stock is slightly volatile.
Currently, Alphabet’s Relative Strength Index (RSI) shows it is neither oversold nor overbought.
The winds of change and innovation continue to blow in favor of technology stocks and analysts predict that the positive trend will continue for Google.
Estimates for 12-month price forecasts for Alphabet Inc have a median target of $1,450, with a high estimate of $1,907 and a low estimate of $1,250 which makes Alphabet shares attractive.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.