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Top Tech Stocks for April 2022
The technology sector is composed of businesses that sell goods and services in electronics, software, computers, artificial intelligence (AI), and other industries related to information technology (IT). The sector includes companies with the largest market capitalizations in the world, such as Apple Inc. (AAPL), Microsoft Corp. (MSFT), and Amazon.com Inc. (AMZN).
Tech stocks, represented by the Technology Select Sector SPDR Fund (XLK), have outperformed the broader market over the past year. XLK has provided investors with a total return of 20.3% over the past 12 months, above the Russell 1000’s total return of 12.9%. These market performance numbers and statistics in the tables below are as of March 21, 2022.
Here are the top five tech stocks with the best value, fastest growth, and most momentum.
Value investing is a factor-based investing strategy that involves picking stocks that you believe are trading for less than what they are intrinsically worth, usually by measuring the ratio of the stock’s price to one or more fundamental business metrics. A widely accepted value metric is the price-to-earnings (P/E) ratio. Value investors believe that if a business is cheap compared to its intrinsic value, as measured by its P/E ratio in this case, then its stock price may rise faster than that of others as the price comes back in line with the worth of the company. These are the tech stocks with the lowest 12-month trailing P/E ratio.
|Best Value Tech Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/E Ratio|
|CDK Global Inc. (CDK)||47.78||5.6||5.6|
|Mandiant Inc. (MNDT)||22.30||5.2||5.9|
|Hewlett Packard Enterprise Co. (HPE)||17.05||22.2||6.1|
|HP Inc. (HPQ)||37.54||39.5||6.7|
|Dell Technologies Inc. (DELL)||52.32||40.0||7.4|
- CDK Global Inc.: CDK Global provides integrated data and technology solutions to the automotive, heavy truck, recreation, and heavy equipment industries. The company helps automotive dealerships and original equipment manufacturers (OEMs) to optimize and streamline their daily operations. CDK Global has more than 30,000 retail client locations. On March 10, the company announced the launch of CDK Unify, a new program enabling delivery of a flexible, intuitive interface for automotive dealerships. Unify will be generally available in Q4 of this year.
- Mandiant Inc.: Mandiant is a provider of cyber defense solutions. The company utilizes threat researchers, reverse engineers, intelligence analysts, and incident responders located in 26 countries. On March 8, the company announced that it would be acquired by Google LLC in an all-cash transaction valued at approximately $5.4 billion. Mandiant is expected to join Google Cloud. The acquisition is anticipated to close later this year.
- Hewlett Packard Enterprise Co.: Hewlett Packard Enterprise offers intelligent technology solutions such as cloud services, high-performance computing and AI, intelligent edge, software, and storage. Globally, the company has 55,000 customers and its edge networking connects 10 million devices.
- HP Inc.: HP is a global provider of personal computing, imaging, and printing products and services. The company’s offerings include desktop and notebook computers, workstations, retail point-of-sale systems, displays, printers and hardware, and support and services. HP’s customers include individual consumers, businesses, and governments. The company holds 27,000 patents and operates in 170 countries throughout the world. For HP’s Q1 FY 2022, ended Jan. 31, it reported 1.7% net earnings growth on 8.8% net revenue improvement year-over-year (YOY). The company said that record quarterly revenue was driven by strong demand and its leadership in hybrid.
- Dell Technologies Inc.: Dell Technologies designs, develops, and manufactures a range of integrated technology solutions, products, and services. Its products include desktops, workstations, notebooks, displays, projectors, and more. The company also offers multi-cloud, big data, and storage solutions to meet a wide variety of its customers’ needs. Dell serves 98% of Fortune 500 companies and employs a sales force of more than 40,000.
These are the top tech stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly year-over-year (YOY) percentage revenue growth and most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in a company’s success. Therefore, ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one figure or the other unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of more than 2,500% were excluded as outliers.
|Fastest Growing Tech Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)||Revenue Growth (%)|
|Microchip Technology Inc. (MCHP)||76.57||42.6||785.7||30.0|
|Western Digital Corp. (WDC)||48.95||15.3||795.0||22.6|
|Avnet Inc. (AVT)||43.04||4.3||689.5||25.6|
|Intuit Inc. (INTU)||466.50||131.9||400.0||69.6|
|National Instruments Corp. (NATI)||40.22||5.3||650.0||14.4|
- Microchip Technology Inc.: Microchip Technology makes microcontroller and analog semiconductors for roughly 122,000 customers across the industrial, automotive, consumer, aerospace and defense, communications, and computing markets.
- Western Digital Corp.: Western Digital develops, manufactures, and provides data storage devices and solutions. It structures its operations across two broad categories: hard disk drives and flash-based memory, the latter of which is a semiconductor technology. The company holds roughly 13,700 active patents worldwide. In early March, Western Digital announced that its Yokkaichi and Kitakami joint venture flash fabrication facilities returned to normal operations in late February. The company’s flash availability will be reduced by roughly 7 exabytes, predominantly in Q3 FY 2022, which ends April 1, and Q4 FY 2022.
- Avnet Inc.: Avnet is a maker of electronics components, especially semiconductors. The company operates in the IoT, components and devices, hardware and software, and integration spaces. It offers over 250 locations in 48 countries and ships roughly 157 billion units annually.
- Intuit Inc.: Intuit is a financial software company. It provides services through brands including TurboTax, QuickBooks, Mint, Credit Karma, and Mailchimp. The company serves over 100 million customers worldwide and employs some 14,200 people. Intuit’s Q2 FY 2022 ended Jan. 31, 2022. For that quarter, net income surged by 400% as total net revenue climbed by nearly 70% YOY. The company’s results were driven by strong performances and growth across its Small Business and Self-Employed, Credit Karma, and Consumer and ProConnect groups.
- National Instruments Corp.: National Instruments, known as NI, makes automated testing anad measurement equipment for the semiconductor, transportation, aerospace, defense, and government, and industrial machinery industries, among others. The company was founded over 40 years ago. The company announced in early March that it had completed the acquisition of Heinzinger Automotive GmbH, the Electronic Vehicle Systems business of Germany-based Heinzinger electronic GmbH. The acquisition is expected to enhance National Instruments’ electrification, battery test, and sustainable energy capabilities. Terms of the deal were not disclosed.
Momentum investing is a factor-based investing strategy that involves investing in a stock whose price has risen faster than the market as a whole. Momentum investors believe that stocks that have outperformed the market will often continue to do so because the factors that caused them to outperform will not suddenly disappear. In addition, other investors, seeking to benefit from the stock’s outperformance, will often purchase the stock, further bidding its price higher and pushing the stock higher still. These are the tech stocks that had the highest total return over the past 12 months.
|Tech Stocks With the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|NVIDIA Corp. (NVDA)||267.34||671.0||108.3|
|Switch Inc. (SWCH)||29.43||4.4||90.8|
|Arista Networks Inc. (ANET)||131.95||40.6||85.1|
|Palo Alto Networks Inc. (PANW)||577.20||56.9||82.2|
|Fortinet Inc. (FTNT)||314.53||50.6||80.3|
|Russell 1000 Index||N/A||N/A||12.9|
|Technology Select Sector SPDR Fund (XLK)||N/A||N/A||20.3|
- NVIDIA Corp.: NVIDIA is a maker of graphics processing units (GPUs), a type of computer chip originally designed for computer graphics. GPUs, once used primarily for personal computer (PC) gaming, have been increasingly used for cryptocurrency mining and machine learning in recent years. NVIDIA’s products also serve other markets, including gaming, professional visualization, data center, and automotive. At NVIDIA’s GTC conference on March 22, the company introduced Hopper GPU architecture and H100 GPU. These are new artificial intelligence (AI) and accelerated computing software and data-center-scale systems with applications in robotics, health care, and other areas.
- Switch Inc.: Switch is a technology infrastructure company. It develops advanced hyperscale retail colocation data centers to help grow the internet and related services. The company serves over 950 customers in the industries including technology and digital media, cloud and managed services, finance, telecommunications, and more. For Q4 2021, Switch reported a net loss versus net income for the prior-year quarter, as well as 26.4% YOY consolidated revenue growth. The company cited strong demand for its Tier 5 Exascale Infrastructure as driving growth.
- Arista Networks Inc.: Arista Networks is a cloud computing firm that focuses on providing services to large-scale datacenter and campus environments. It has shipped more than 50 million cloud networking ports worldwide. In Nov. 2021, Arista completed a four-for-one stock split. Trading began on the split-adjusted basis on Nov. 18, 2021.
- Palo Alto Networks Inc.: Palo Alto Networks is a network security company. It provides firewalls to identify and control applications, scan content, prevent data leaks, and perform a variety of other services. The company serves over 80,000 enterprise customers.
- Fortinet Inc.: Fortinet is a cybersecurity company serving enterprises, service providers, and government organizations worldwide. Its Security Fabric platform leverages AI and machine learning technology to provide clients with security solutions for networked, application, cloud, and mobile environments. The company has more than 500,000 customers around the world.
The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.