3 Top-Notch Tech Stocks Flying Under the Radar

Technology stocks have been selling off amid the economic recovery but are expected to dominate the market in the foreseeable future thanks to the continuation of pandemic-driven trends and the advanced technology needs of several industries. Against this backdrop, we think it wise to bet on Qorvo (QRVO), Arrow (ARW), and FLIR Systems (FLIR). They have yet to attract widespread investor attention even though they have solid upside potential. Read on.

Tech stocks have performed moderately so far in 2021 as investors have rotated away from tech stocks to cyclical stocks as the economy switches gears into recovery drive. Investors’ pessimism about tech stocks is reflected in Technology Select Sector SDPR Fund’s (XLK) 4.4% loss over the past month. The Nasdaq also sank 2.6% on May 10 in its worst session since March amid a broader tech sell-off.

However, several technological advances in cloud computing, artificial intelligence (AI), and 5G communications, among others, are expected to shape the industry’s future. So, even though tech stocks are selling off now, we think it would be wise to bet on those that have strong fundamentals.

Qorvo, Inc. (QRVO), Arrow Electronics, Inc. (ARW), and FLIR Systems, Inc. (FLIR) are not making headlines, but based on their expanding market reach and consistent product innovation, these stocks could deliver solid returns in the coming months. So, the time is perhaps now ripe to buy these stocks.

Qorvo, Inc. (QRVO)

QRVO develops and markets a wide range of radio frequency (RF) technologies for the mobile, infrastructure, defense/aerospace and Internet of Things (IoT) markets. The company operates through two segments: Mobile Products (MP), and Infrastructure and Defense Products (IDP).

The company’s revenue for its fiscal fourth quarter, ended April 3, was  $1.10 billion, which represents a 36.2% year-over-year increase. Its gross profit increased by 57.8% compared to the same period last year to $528.50 million. QRVO’s net income increased 492.7% year-over-year to $298.70 million, and its  EPS was  $2.60, up 504.7% year-over-year.

For the quarter ending June 30, analysts expect QRVO’s EPS to be  $2.42, which represents a 61.3% year-over-year increase. It also surpassed consensus EPS estimates in each of the trailing four quarters. The company’s annual revenues are expected to increase 14.5% from the same period last year to $4.60 billion in the current .

On May 6, 2021, QRVO acquired Mountain View, California-based NextInput,  a pioneer in the emerging field of force-sensing solutions for human-machine interface. The acquisition is expected to expand QRVO's technology portfolio and enable it to accelerate the deployment of force-sensing solutions that utilize MEMS-based sensors. The stock has gained 66.5% over the past year to close yesterday’s trading session at $171.47.

It’s no surprise that QRVO has an overall B rating, which equates to Buy in our POWR Ratings system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

The stock has an A grade for Growth and Quality, and a B grade for Sentiment. Click here to see QRVO’s ratings for Momentum, Value and Stability as well.

QRVO is ranked #22 of 98 stocks in the B-rated Semiconductor & Wireless Chip industry.

Click here to checkout our Semiconductor Industry Report for 2021

Arrow Electronics, Inc. (ARW)

ARW provides products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions. The company serves original equipment manufacturers (OEMs) and value-added resellers. It operates through two segments: Global Components and Global Enterprise Computing Solutions.

For its fiscal first quarter, ended April 3, ARW’s total revenues were $8.40 billion, representing a 31.4%  increase year-over-year. Its net profit for the quarter increased 316.8% from the same period last year to $206.32 million. The company’s EPS increased 345.2% year-over-year to $2.80.

The company’s EPS for the quarter ending June 30 is expected to increase 84.3% from prior-year quarter to $2.93. Also, ARW surpassed consensus EPS estimates in each  of the trailing four quarters. Analysts expect its revenue to be $8.49 billion for the quarter ending June 30, which represents a 28.5% year-over-year rise.

In March, ARW announced an agreement with NVIDIA Corporation (NVDA)  to distribute its professional visualization product portfolio, incorporating ARW’s full services offering to designers and engineers. The agreement  is expected to help ARW increase its customer base. The stock has rallied 79.2% over the past year to close yesterday’s trading session at $117.32.

ARW’s POWR Ratings reflect this promising outlook. The stock has an overall A rating, which equates to Strong Buy in our POWR Ratings system. It has an A grade for Growth, and a B grade for Value and Quality. In addition to these ratings, one can see ARW’s ratings for Stability, Sentiment and Momentum here.

ARW is ranked #5 of 45 stocks in the B-rated Technology-Electronics industry.

FLIR Systems, Inc. (FLIR)

FLIR designs, develops, markets, and distributes thermal imaging systems, visible-light imaging systems, locator systems, measurement and diagnostic systems, and threat-detection solutions worldwide. The company’s operating segments include its Industrial Business Unit, Government and Defense Business Unit, and Commercial Business Unit.

FLIR’s revenue for the fiscal first quarter, ended March 31,  increased 36.3% year-over-year to $467.31 million. Its  operating income came in at $52.50 million, up 84.1% year-over-year. Its net income for the quarter was  $38.81 million, which represents a 151.6% rise from the same period last year. And its  EPS increased 150% year-over-year to $0.30.

Analysts expect FLIR’s EPS and revenue to increase 8.1% and 4.1%, respectively, year-over-year to $2.54 and $2.03 billion in its fiscal year 2022. Also,  it surpassed consensus EPS estimates in three of the trailing four quarters.

On May 10, FLIR  announced  that it had received more than $70 million in new orders for its advanced ground robots from the U.S. Armed Services. This is expected to boost its revenues. The stock has surged 22.6% over the past year to close yesterday’s trading session at $58.95.

FLIR’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which equates to Buy in our proprietary rating system. It has an A grade for Growth, and a B grade for Momentum and Quality. Click here to see the additional POWR Ratings for FLIR (Sentiment, Value and Stability).

FLIR is ranked #12 of 68 stocks in the Air/Defense Services industry.

QRVO shares were trading at $169.85 per share on Tuesday afternoon, down $1.62 (-0.94%). Year-to-date, QRVO has gained 2.15%, versus a 10.78% rise in the benchmark S&P 500 index during the same period.

About the Author: Ananyo Guha Niyogi

Ananyo’s ardent interest in capital markets, wealth management, and financial regulatory issues, led him to a career as an investment analyst. His goal is to educate individual investors by making complex financial issues easy to understand.

More...

The post 3 Top-Notch Tech Stocks Flying Under the Radar appeared first on StockNews.com