Investors are looking to technology stocks to bolster their financial portfolios! - Internet stocks enjoyed a bull market in 2013, and while telecom and technology stocks rose only 18%, optimism remains high for 2014.
2013 marked a successful comeback for many of the world's stock markets. Stocks have rebounded from the devastating financial crisis that began in 2008, and investor confidence is slowly but surely returning to the international markets. Analysts’ reports reveal a solid performance for tech stocks as a whole, with lots of room for upward movement. Many of the strongest performers from 2013 include the Big 3: Amazon, Google and Facebook – for a combined average share price increase of 65%. Investor confidence in tech stocks remains solid, with several notable investment options on the table for the year. One of the leading global telecoms stocks – Cisco (NASDAQ:CSCO) – is certainly a stock to consider in 2014. The company boasts net cash reserves of $30 billion, with a buyback yield in the region of 5%. The earnings-per-share grew by 12% in the last decade, however that has slowed somewhat in recent years. Still, Cisco is an industry-leading giant and it warrants consideration as one of the top tech stock picks for the year.
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- CSCO 15-Year Financial Data
- The intrinsic value of CSCO
- Peter Lynch Chart of CSCO
The company's market cap is $118.8 billion; the 52 week range is between $19.98 and $26.49 per share. The earnings-per-share is listed at $1.84 and 5.35 billion shares have been issued. Cisco Sytems (NASDAQ:CSCO) is currently trading at $22.22 per share – dead centre in the 52-week range. Cisco shares remain on the affordable end of the spectrum, especially when compared to stocks like Apple, Google and the like.
Always a big player in the tech stocks arena, IBM continues to reel in investors with solid performance and strong gains. The company has a free cash flow yield in the region of 9% and a dividend plus share buyback of 7%. The historical returns on invested capital are in the region of 20% and some 86% of all revenues are derived from software solutions and other value added services. Since IBM is such a massive global force, there are significant barriers to entry for competitors. This bodes well for the stock, and long-term prospects for investors certainly look healthy. Note that over the last 10 years, the EPS have averaged 12% annually.
It is clear from the above graphic that IBM stocks have enjoyed strong and consistent gains in the past five years. A recovery is evident from the early part of 2010 and growth has remained strong and steady to the present day. The current stock price is $187.26, with a 52-week trading range between $172.57 and $215.90. This place is IBM's current stock price on the lower end of that range, with lots of room for upward movement. The market cap is $203.34 billion with a price earnings ratio of 12.94.
While many investors balk at the idea of Intel stocks – owing to its poor performance in 2013 – there is hope on the horizon. The new chief executive officer of Intel – Brian Kraznich - has intimated that Intel will be branching out into multiple industries in coming times. This diversification strategy bodes well since Intel is seen as a smart solution to hardware. Intel is intent on developing products with smart chip technology – across multiple sectors. This semiconductor producer has been struggling in recent times, and stocks are affordable with plenty of opportunities.
Intel Corporation (NASDAQ:INTC) stocks are currently trading at $25.53 per share. The 52-week share price ranges from $20.10 per share – $26.04 per share. The market cap is 127.16 billion and the price-earnings ratio is 13.77. Intel stocks earnings-per-share is listed as 1.85 and there are 4.98 billion shares on the market. The dividend yield is presently 3.5%, so investors can approach this stock with cautious optimism in 2014.
Entry level investors will be pleasantly surprised to learn that Hewlett-Packard shares are affordable. Although the share price is depressed, there is perhaps room for optimism in 2014. Hewlett-Packard (HPQ) sports a dividend yield margin that is above 2%. This stock performed well on paper – at approximately 75% during 2013 – off of low levels. It is not crystal clear which direction this stock will go during the course of 2014, but that is no reason to discount Hewlett-Packard as a potential strong performer in what may well be a comeback year.
The current price for Hewlett-Packard (HPQ) is $27.70. The 52-week range traded between $15.85 and $27.77. That puts (HPQ) firmly at the top of its trading range. The dividend per yield is 2.10 and the Earnings per Share (EPS) is 2.63. Currently there are 1.91 billion Hewlett-Packard shares with a total cap of $52.87 billion. The price/earnings ratio is 10.55. Hewlett-Packard (HPQ) slumped to a low of $12.44 on November 23rd 2012. The share price has more than doubled in 14 months. Investors thus have an opportunity to continue to enjoy solid gains in 2014. While the 2007 highs will likely not be regained anytime soon, the stable and consistent gains enjoyed over the past 14 months provide investors with a glimmer of hope for the future of Hewlett-Packard (HPQ).
Top Variety to Add to Tech Stocks
Investors looking to diversify beyond tech stocks may be interested in (NASDAQ:KEYW) with anticipated earnings growth of 290% +, Black Diamond (NASDAQ:BDE) 370% + expected 2014 earnings growth, and KB Home (KBH) with expected earnings growth for 2014 of 300% +. These and other investments can certainly be included as part of an overall basket of diversified investments for the year.