4 tech stocks under $50 to buy now
Inflation is still hovering around the 40-year high and the Federal Reserve is trying to combat it by raising interest rates. This led the capital-intensive tech industry to see a sell-off on investor concerns about their rising borrowing costs.
However, rising investment and increasing dependence of companies on technological solutions are improving the long-term outlook for the industry. Additionally, new employment data shows that employers are continuing to hire and grow their technology teams.
CompTIA’s analysis of the US Bureau of Labor Statistics report shows the tech sector added 25,500 net new workers in August. Employment in the tech industry increased by 175,700 jobs in 2022 and is followed by 46% before 2021.
The global industrial networking solutions market size is estimated at USD 13.56 billion in 2022 and is projected to reach USD 34.77 billion by 2028, growing at a steady rate. 17% CAGR.
Against this backdrop, the fundamentally strong technology stocks of Cisco Systems, Inc. (CSCO), Extreme Networks, Inc. (OUTSIDE), AudioCodes Ltd. (CAD) and Aviat Networks, Inc. (AVNW), which trade for less than $50, could be ideal investments now.
Cisco Systems, Inc. (CSCO)
CSCO designs, manufactures and sells Internet Protocol-based networks and other products related to the communications and information technology industry worldwide. It provides infrastructure platforms, collaboration products and security products.
On August 23, CSCO declared a quarterly cash dividend of $0.38 per common share, payable to shareholders on October 26, 2022. This reflects the company’s earning capacity for shareholders.
In July, CSCO launched a new Webex Wholesale Route-to-Market (RTM) for service provider partners to meet the changing needs of SMBs. This wholesale business model should leverage the capabilities of the Webex suite.
CSCO’s total revenue was $51.56 billion for the fiscal year ended July 30, 2022, representing year-over-year growth of 3.5%. Its operating profit rose 8.9% year-on-year to $13.97 billion, while its non-GAAP net income rose 3.4% year-on-year last to reach $14.09 billion. EPS increased 4.3% year over year to $3.36.
Analysts expect CSCO’s revenue for the first quarter ending October 2022 to be $13.30 billion, indicating 3.1% year-over-year growth. The company’s EPS for the same quarter is expected to increase 1.8% from the prior year quarter to $0.84. Additionally, CSCO has exceeded consensus EPS estimates in each of the past four quarters, which is impressive.
CSCO gained 1.2% intraday to close its latest trading session at $45.02.
CSCO POWR Rankings reflect this promising prospect. The company has an overall rating of B, which translates to Buy in our proprietary rating system. POWR ratings rate stocks on 118 different factors, each with its own weighting.
CSCO has an A rating for quality and a B for stability. It is ranked No. 6 out of 52 stocks in the Technology – Communication/Networking industry.
Beyond what we’ve indicated above, we also provide growth, value, momentum, and sentiment ratings for CSCO. Get all CSCO notes here.
Extreme Networks, Inc. (OUTSIDE)
EXTR is a software-driven networking solution provider that designs, develops and manufactures wired and wireless network infrastructure equipment and engages in software development.
On September 7, EXTR announced that Minor League Baseball (MiLB) had selected Extreme as its official technology innovation partner. Additionally, the company has been named the official provider of MiLB’s Wi-Fi solutions, Wi-Fi analysis solutions and WAN edge solutions under a five-year partnership.
On August 18, EXTR introduced the Extreme AP5050, the industry’s first outdoor 6E Wi-Fi access point optimized for deployment in outdoor venues, convention centers, hospitals, college campuses and large stadiums. The new offering could significantly increase the company’s revenue stream.
EXTR’s revenue increased 10.2% year over year to $1.11 billion in the fiscal year ended June 30. Its non-GAAP operating profit increased 23.5% from the previous year’s value to $136.18 million, while its non-GAAP net profit improved by 43. .2%. year over year to $103.45 million. The company’s non-GAAP net earnings per common share rose 35.1% year over year to $0.77.
Analysts expect EXTR’s revenue for the fiscal year ending June 2023 to be $1.23 billion, indicating a 10.6% year-over-year increase, while its EPS is expected to improve 26.8% year-on-year to $0.98. Additionally, EXTR has exceeded consensus EPS estimates in each of the past four quarters, which is impressive.
EXTR has gained 32.4% over the past year and 37.5% over the past three months to close its last trading session at $13.97.
It’s no surprise that EXTR has an overall A rating, which translates to a strong buy in our POWR rating system. The stock has an A rating for quality and a B rating for growth and value. It is ranked #3 in the same industry.
In addition to the POWR ratings we listed above, we also assigned EXTR ratings for Momentum, Stability, and Sentiment. Get all EXTR ratings here.
AudioCodes Ltd. (CAD)
AUDC, based in Lod, Israel, offers advanced communications software, products and productivity solutions for the digital workplace. The Company’s offerings include solutions, products and services for unified communications, contact centers, VoiceAI lines of business and service providers.
On August 2, AUDC declared a cash dividend of 18 cents per share. The total dividend amount is approximately $5.7 million. The dividend was payable on August 31. This reflects the company’s cash-generating capacity.
AUDC’s total revenue increased 12.9% year over year to $68.36 million in the second quarter ended June 30. gross profit increased 5.8% from the previous year’s value to $44.51 million. The company’s non-GAAP net income was $11.35 million and its non-GAAP net EPS was $0.34.
Consensus EPS for the third fiscal quarter (ending September 2022) is expected to be $0.35. The consensus revenue estimate of $70.41 million for the same quarter reflects an 11.1% increase over the same period last year.
The stock gained 2.1% intraday to close its last trading session at $22.25.
The company’s overall A rating translates to Strong Buy in our proprietary rating system. AUDC is rated A for quality and a B for value, stability and sentiment. It is ranked #1 in the same industry.
To view additional POWR ratings for growth and momentum for AUDC, Click here.
Aviat Networks, Inc. (AVNW)
AVNW offers wireless transportation solutions worldwide. It provides a comprehensive suite of localized professional and support products and services that enable customers to simplify their networks.
In July, AVNW announced the completion of the acquisition of Redline Communications Group Inc. by an AVNW subsidiary. The acquisition should enable the company to offer its customers an integrated end-to-end offering for wireless access and transport. It is expanding its research and development team with a new 5G development center in Canada.
For the fourth quarter of 2022, AVNW’s total revenue increased 8% year-on-year to $77.42 million. Its operating profit rose 40.4% year-over-year to $5.24 million. Its non-GAAP net income and non-GAAP net earnings per share were $7.83 million and $0.67, up 47.5% and 52.3% from the quarter. of the previous year.
The Street EPS estimate for the fiscal first quarter ending September of $0.71 reflects a 6.3% year-over-year rise. Similarly, Street’s revenue estimate for the same quarter of $81.10 million indicates a 10.9% improvement over the prior year period. Additionally, AVNW has exceeded consensus EPS estimates in each of the past four quarters.
Over the past six months, AVNW stock has gained 19.8% to close its last trading session at $31.89.
This promising outlook is reflected in AVNW’s POWR ratings. The stock has an overall rating of B, which is equivalent to Buy in our proprietary rating system. AVNW also has a B rating for growth and value. It is ranked #9 in the same industry.
Click here to see additional POWR ratings for AVNW (momentum, stability, feeling and quality).
CSCO shares were up $0.01 (+0.02%) in after-hours trading Thursday. Year-to-date, the CSCO is down -26.84%, compared to a -15.08% rise in the benchmark S&P 500 over the same period.
About the Author: Kritika Sarmah
Her interest in risky instruments and her passion for writing made Kritika an analyst and financial journalist. She earned her Bachelor of Commerce degree and is currently pursuing the CFA program. With its fundamental approach, it aims to help investors identify untapped investment opportunities. After…