In this piece, we will take a look at the ten best affordable tech stocks to invest in now. If you want to skip the industry primer and jump to the top five stocks in this list, then take a look at 5 Best Affordable Tech Stocks to Invest In Now.
One of the most popular segments in the stock market that captures the greatest amount of attention is the technology industry. The meteoric rise in consumer electronics over the previous decade has transformed lives and shaken up how people all over the globe work, live, and play. As a result, the technology industry has seen significant interest from both investors and entrepreneurs with both in the search for new technologies to transform lives, create new industries, and disrupt existing ones.
This optimism has also translated into bullish research reports for the technology industry. For instance, a report from IDC stated that the industry as a whole will be worth a whopping $5.3 trillion as this year comes to an end and it recovers from the onslaught of the coronavirus pandemic. Out of the $5.3 trillion, the U.S. is the largest technology market in the world, believes IDC, as it will capture $1.8 trillion of the total pie. IDC's growth estimate for the industry ranges from 5% to 6%.
Another report, from The Business Research Company, states that from an estimated value of $8.3 trillion last year, the information technology industry will grow at a compounded annual growth rate (CAGR) of 11.2% to be worth $9.3 trillion by the end of 2022. Additionally, it also estimates that from 2022 to 2026, the industry's CAGR will stand in at 10.3% and its value will be worth $13.8 trillion.
Billionaire Ken Fisher, one of the wealthiest people in the world and the chief of renowned hedge fund Fisher Investments, also understands the importance of the technology sector. In a recent interview, Mr. Fisher mentioned the sector and simply outlined that:
On May 26th I did a visual scattergram with some data on this on my Twitter feed and you can look that up from May 26th but the fact of the matter is all this year the data points reinforce the simple notion, said very simply, that if the market's going up tech will be doing better than the market, if the market's going down tech will doing worse. But you could extrapolate that much more broadly, the extrapolation that's more broad and still fully valid is when the market's going up growth stocks are leading when the market's going down growth stocks are lagging.
Therefore, it just might be the right time to look at some technology stocks, and that's what we've done for you today. Some of the more popular stocks in this list are Dropbox, Inc. (NASDAQ:DBX), Corning Incorporated (NYSE:GLW), and GoPro, Inc. (NASDAQ:GPRO).
In order to sift out some of the top affordable technology stocks on the stock market, we looked at several industries and identified relevant trends and other details to separate the wheat from the chaff. The selected stocks were then ranked by hedge fund sentiment courtesy of Insider Monkey's 912 hedge fund survey for this year's first quarter.
Best Affordable Tech Stocks to Invest In Now
10. United Microelectronics Corporation (NYSE:UMC)
Number of Hedge Fund Holders: 15
Share Price as of August 12, 2022: $7.20
United Microelectronics Corporation (NYSE:UMC) is a contract chip manufacturer headquartered in Taiwan. The company is responsible for manufacturing semiconductors for other firms on mature process technology nodes.
A key fact about the United Microelectronics Corporation (NYSE:UMC) is the fact that it is Taiwan's second largest contract chip manufacturer. This means that the firm has a strong order backlog, particularly for mature technologies that are underserved by leading edge chipmakers. Projections for United Microelectronics Corporation (NYSE:UMC)'s four market segments lend credence to this, as all of them are expected to grow by an average of 10% over the next four years. Finally, the strength of its business model was highlighted in its latest earnings, which saw revenue grow by 5% in the first quarter of this year despite a drop in wafer shipments.
15 out of the 912 hedge funds part of Insider Monkey's Q1 2022 survey had invested in the company.
Out of these, Peter Rathjens, Bruce Clarke, and John Campbell's Arrowstreet Capital is United Microelectronics Corporation (NYSE:UMC)'s largest investor through a $48 million stake that comes via 5 million shares.
United Microelectronics Corporation (NYSE:UMC) joins Corning Incorporated (NYSE:GLW), Dropbox, Inc. (NASDAQ:DBX), and GoPro, Inc. (NASDAQ:GPRO) in some of the hot affordable technology stocks on the market.
9. Ping Identity Holding Corp. (NYSE:PING)
Number of Hedge Fund Holders: 20
Share Price as of August 12, 2022: $28.16
Ping Identity Holding Corp. (NYSE:PING) is a workforce identity management and authentication services provider that is headquartered in Denver, Colorado, United States. The company provides products such as single sign on and multi factor authentication that allow organizations to securely operate.
Ping Identity Holding Corp. (NYSE:PING) is known for having pioneered the single sign on (SSO) technology for companies, and this has resulted in it counting more than half of Fortune 500 companies including 13 of the 15 largest U.S. banks and five global aerospace companies as its clients. The company's market has a total addressable size of $50 billion and its revenues of less than $2 billion leave for plenty of growth. Finally, Ping Identity Holding Corp. (NYSE:PING) is slated to be acquired by Thoma Bravo for a $28.5 share price.
As the first quarter of this year ended, 20 out of the 912 hedge funds surveyed by Insider Monkey had bought stakes in the company.
Ping Identity Holding Corp. (NYSE:PING)'s largest investor is Robert Smith's Vista Equity Partners which owns 8 million shares that are worth $228 million.
Baron Funds mentioned the company in its Q1 2022 investor letter and outlined:
“Ping Identity Corporation (NYSE:PING) offers identity and access management security software. Shares appreciated due to strong fourth quarter financial results and upbeat guidance for 2022. Annual recurring revenue growth accelerated for a third straight quarter driven by strong adoption of Ping’s SaaS software products and cross selling new customer identity-focused products to existing customers. Management guided to further acceleration next year driven by healthy demand for the SaaS platform and for newer products such as online fraud detection, identity security orchestration, and Ping’s federal government solutions. Longer term, we maintain conviction in Ping due to growing demand for identity-oriented cybersecurity, Ping’s continued market share gains from legacy on-premise tools, and management’s focus on expanding distribution through new channel partners. Ping also trades at a reasonable valuation relative to other leading cybersecurity peers.”
8. Maxar Technologies Inc. (NYSE:MAXR)
Number of Hedge Fund Holders: 20
Share Price as of August 12, 2022: $26.98
Maxar Technologies Inc. (NYSE:MAXR) is an Earth intelligence and space infrastructure services provider based in Westminster, Colorado, United States. The company provides high resolution imagery of the Earth, and equipment for use by other satellite companies.
Maxar Technologies Inc. (NYSE:MAXR) is one of the few key players in the highly lucrative Earth imaging segment. The industry is currently worth $9.1 billion and is slated to reach $37.5 billion by 2026 for a whopping CAGR of 33%. The company has counted the U.S. government as its customer for more than 20 years, and it will launch a new satellite constellation with SpaceX this year to further bolster its imagery capabilities.
Truist lowered Maxar Technologies Inc. (NYSE:MAXR)'s share price target to $44 from $52 in August 2022 but stated that it is well positioned to capitalize and develop an important industry. Insider Monkey's Q1 2022 survey of 912 hedge funds revealed that 20 had invested in the company.
Jeffrey Jacobowitz's Simcoe Capital Management is Maxar Technologies Inc. (NYSE:MAXR)'s largest investor. It owns 2.5 million shares that are worth $100 million.
7. Bilibili Inc. (NASDAQ:BILI)
Number of Hedge Fund Holders: 24
Share Price as of August 12, 2022: $25.21
Bilibili Inc. (NASDAQ:BILI) is a Chinese company that provides online entertainment services for kids. These services include video games, video services, and other content.
Bilibili Inc. (NASDAQ:BILI) is a platform that is performing well in two key metrics. Its latest earnings report revealed that the company grew its monthly active user base by 31% annually and its monthly active content creators by a strong 75% for the same time period. It is also beating Netflix in key metrics such as bounce rate (20% vs 40%) and average time spent on site (20 minutes vs nine minutes).
As 2022's March quarter ended, 24 out of the 912 hedge funds surveyed by Insider Monkey had invested in the company.
Bilibili Inc. (NASDAQ:BILI)'s largest investor is Jonathan Guo's Yiheng Capital which owns 9 million shares that are worth $239 million.
6. Yext, Inc. (NYSE:YEXT)
Number of Hedge Fund Holders: 25
Share Price as of August 12, 2022: $5.07
Yext, Inc. (NYSE:YEXT) operates a cloud based search platform that aids consumers with their purchasing decisions. This platform includes a variety of features such as reviews, business facts, and information updating, It is headquartered in New York, New York, United States.
As counterintuitive as it might sound, a key appealing factor about Yext, Inc. (NYSE:YEXT) is the fact that it is severely undervalued on the stock market. The company has embedded artificial intelligence into its question and answer platform, and nearly all of its revenue is recurring, two key points that will favor an acquisition and result in a meaty premium for investors who entered the stock at a low price.
Insider Monkey's survey of 912 hedge funds for this year's first quarter outlined that 25 had bought Yext, Inc. (NYSE:YEXT)'s shares.
Out of these, Mitchell Green's Lead Edge Capital is the company's largest investor through a $48 million stake that comes via 6.9 million shares.
Alongside Dropbox, Inc. (NASDAQ:DBX), Corning Incorporated (NYSE:GLW), and GoPro, Inc. (NASDAQ:GPRO), Yext, Inc. (NYSE:YEXT) is a top affordable technology stock.
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Disclosure. None. 10 Best Affordable Tech Stocks to Invest In Now is originally published on Insider Monkey.