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Top 10 Tech Stocks To Invest In Right Now

For better or worse, growth stocks are notoriously volatile. But for astute investors who can manage to recognize timely buying opportunities, they can be a fantastic way to generate outsized gains over the long term.

So we asked three top Motley Fool investors to each discuss a growth stock that they think investors should consider buying now. Read on to learn why they like following stocks.

 

Top 10 Tech Stocks To Invest In Right Now: Twitter, Inc.(TWTR)

Twitter (NYSE:TWTR) added to its 47% spike in 2017 to gain over 80% so far this year. The micro-blogging platform isn’t logging anything near the user growth or the profit boosts that peer Facebook has managed. However, Twitter did post a 21% sales improvement in the most recent quarter as growth accelerated sharply from the prior quarter’s 2% uptick. Looking ahead, shareholders are hoping that CEO Jack Dorsey and his team can significantly boost the user base from its current level of 336 million. As its content trends toward high-margin video, meanwhile, advertising income should help Twitter log another year of earnings improvements as it works toward achieving annual profitability.

Top 10 Tech Stocks To Invest In Right Now: Hess Corporation(HES)

While red-hot oil prices helped fuel Hess’ gains this year, it was far from the only catalyst. Hess and its partner ExxonMobil announced three more offshore discoveries near Guyana, bringing the total to eight. The partners now plan to develop three phases of that field, which could produce more than 500,000 barrels of oil per day by late 2023. In addition to that, Hess continued cleaning up its portfolio and balance sheet by selling its joint venture in the Utica Shale and paying off more debt. Meanwhile, the company has used the excess cash generated by higher oil prices to buy back stock, authorizing a $1.5 billion repurchase program, enough to retire nearly 10% of its outstanding shares. The company could expand that program even further later this year given the uptick in crude prices.  

Top 10 Tech Stocks To Invest In Right Now: Red Hat, Inc.(RHT)

This is a rare opportunity to pick up shares in a red-hot growth stock at a serious discount.

The Linux and open-source software veteran had seen its share prices double in 52 weeks, heading into June’s first-quarter report. In that report, Red Hat exceeded its own guidance targets across the board and also stomped Wall Street’s expectations. Yet, the stock took a 12% nosedive the next day and has stayed down ever since. Today, Red Hat shares are trading 23% below those pre-earnings highs.

Analysts took one look at Red Hat’s modest second-quarter guidance, ignoring optimistic full-year targets, and punished the stock with a slew of downgrades and target-price cuts.

It’s true that Red Hat shares were trading a little high before this correction, as the market cap amounted to 112 times trailing earnings and 36 times free cash flows. But Red Hat has earned its druthers by posting a long string of fantastic high-growth results. In the first quarter, earnings rose 24% year over year on 20% higher sales.

The growth story hasn’t changed — analysts simply overreacted to a strong seasonal swing. Right now, Red Hat’s stock trades at 27 times free cash flows — quite comparable to larger and slower-growing enterprise software rivals SAP (NYSE: SAP) at 33 times FCF and Microsoft’s (NASDAQ: MSFT) price-to-FCF ratio of 23.

This sale won’t last. Grab Red Hat’s stock while the discount is hot.

Top 10 Tech Stocks To Invest In Right Now: Apple Inc.(AAPL)

Successful investors know the value of a company that generates cash and has a durable competitive advantage over the competition. If you combine those with growth you get a stock with home run potential. That’s why after all these years of the stock going up, Apple is still a great buy today. 

The chart below shows that Apple is still a growth company, increasing revenue by 45% over the last five years and generated over $53 billion of net income in the past year. 

AAPL Revenue (TTM) Chart

AAPL REVENUE (TTM) DATA BY YCHARTS.

What Apple has going for it is an engrained ecosystem in smartphones that will be nearly impossible for competitors to penetrate. The iPhone may only have 15.6% of the global smartphone market, according to IDC, but it’s the premium portion of the market and generates far more value than competitors. iPhone is also the center of the ecosystem, which expands to Macs, Apple TVs, AirPods, and other products that work seamlessly with Apples apps and services. 

For investors, the earnings you see above are returned in the form of a dividend, currently yielding 1.6%, and share buybacks using the $145.4 billion of net cash on the balance sheet. With a new plan to be "cash neutral," that could mean hundreds of billions in share buybacks over the next decade, $100 billion of which is already authorized by the board of directors. Whether you’re looking at earnings, cash on the balance sheet, or a company with a wide competitive moat, Apple fits the bill. 

Best China Stocks To Buy Right Now

Many conservative investors gravitate toward blue-chip dividend stocks with healthy yields well above what the overall market pays. Right now, the market average of about 2% isn’t all that much for income-hungry investors, especially as bond rates start to rise more sharply.

Fortunately, you can find a number of solid investment choices within the Dow Jones Industrials (DJINDICES:^DJI) that yield 3% or more. Among them are these stocks. Each of them faces challenges that could present difficulties in the short run, but they’ve demonstrated an ability to overcome adversity and produce long-term growth.

Best China Stocks To Buy Right Now: Apple Inc.(AAPL)

Apple Inc. (NASDAQ:AAPL) appeared to be the showstopper on Friday as it sprung to a record high of $184.25 during Friday on news that Warren Buffett’s Berkshire Hathaway Inc had beefed up its stake in the iPhone maker.  Apple shares jumped more than 3.9% on May 4, 2018, marking the largest weekly percentage gain since October 2011.

Apple’s ascent eradicates fears about subdued iPhone demand which clouded the tech and semiconductor market a few days back. The technology giant topped the earnings and revenue estimates in the most-recent earnings report. Apple beefed up its plan to return cash to its shareholders through dividend hikes and additional buybacks.

Best China Stocks To Buy Right Now: Quanta Services, Inc.(PWR)

Quanta Services Inc (NYSE:PWR) is a leading national provider of specialty contracting services and one of the largest contractors serving the transmission and distribution sector of the North American electric utility industry.  Quanta Services has operations in the United States., Canada, Australia and other selected international markets. This Zacks Rank #2 company has a Value Score of A. The 3-5 year EPS growth rate for the stock is estimated at 8%.

Best China Stocks To Buy Right Now: Ulta Salon, Cosmetics & Fragrance, Inc.(ULTA)

Ulta Beauty, which sells cosmetic products and uses in-store salons to generate foot traffic at its stores, opened 100 new stores in 2017 and finished the year with 1,074 locations. It plans to open another 100 stores this year.

Ulta Beauty is confidently expanding because it consistently grows its comparable-store sales, revenue, and earnings at impressive rates. The retailer’s comps rose 11% last year as its revenue and adjusted diluted EPS grew 21% and 25%, respectively. Those are solid growth rates for a stock that trades at 24 times this year’s earnings.

However, two factors caused Ulta’s shares to slide 14% over the past 12 months. First, Ulta expects just 6% to 8% comps growth this year, with revenue growth in the "low teens." This indicates that Ulta could rely more on new store openings than comps growth to fuel its revenue expansion.

Second, some investors fear that Sephora’s advance into J.C. Penney stores, Amazon’s partnerships with high-end beauty brands, and other headwinds could diminish Ulta’s leadership.

Those concerns are valid, but Ulta’s comps growth remains impressive for a 28-year-old retailer, and its unique combination of stores with salons should hold its rivals at bay. The company also has $397.4 million in cash, cash equivalents, and short-term investments to fall back on, as well as a clean balance sheet. With a strong track record and solid financials, I think Ulta still has room to run.

Best China Stocks To Buy Right Now: Markel Corporation(MKL)

Warren Buffett gave the world a great method of making money: Open a successful insurance operation and then invest the premiums that clients pay in investments that pay a lot more than the fixed-income securities that most insurance companies choose for their portfolios. Markel’s history as a publicly traded company dates back to 1986, and the company has an extremely good track record of generating positive underwriting profits, running about 70% with several years sporting very attractive returns.

Markel still has a much different emphasis than the Oracle of Omaha’s insurance operations. Rather than having brand-name car insurance that ranks among the nation’s most popular brands, Markel instead offers only specialty lines of insurance. There’s not as much volume for the types of insurance that you can get from Markel as there is for vanilla lines like auto, home, or life insurance. But because it’s tough to find other companies that are willing to take on the risks that Markel’s willing to assume, the specialty insurance company is able to get enough of a margin to protect it from adverse events. Moreover, because it writes a lot of different types of insurance, Markel’s different risks aren’t as correlated with each other, making a catastrophic year where everything goes wrong less likely.

With a sizable investment portfolio, Markel has generated strong returns the same way Buffett has. As long as its stock-picking prowess remains good, Markel should continue to find ways to deliver performance for its shareholders.

Top 5 Biotech Stocks To Invest In Right Now

In a matter of just a few years, “the Cloud” has evolved from a budding new tech feature to one of the main factors driving growth in the technology sector. Cloud computing is now an essential focus for software-related companies, and cloud stocks have piqued the interest of many tech-focused investors.

New technologies and changing consumer behavior have changed the shape of the technology landscape, and an industry that was once centered on the personal computer has adapted to survive in the world of mobile computing and the Cloud. The markets have been paying attention, and some of the best tech stocks have been those that are either primarily cloud-based companies, or those that have shown growth in their cloud operations.

With this in mind, we’ve highlighted three stocks that are not only showing strong cloud-related activity, but also strong fundamental metrics. Check out these three cloud stocks to buy right now:

Top 5 Biotech Stocks To Invest In Right Now: Senseonics Holdings, Inc.(SENS)

Senseonics Holdings is the best performer of the three, with its stock price skyrocketing more than 130% over the last 12 months. The big news for Senseonics came in March when an FDA advisory committee unanimously recommended approval for the company’s Eversense implantable continuous glucose monitoring (CGM) system.

The potential for Eversense has made Senseonics quite popular on Wall Street. Analysts have picked it as one of the fastest-growing diabetes stocks of 2018 — and, so far, they’ve been right on the money. 

Eversense includes a small sensor inserted completely under the skin. This sensor communicates with a smart transmitter worn over it. Blood glucose levels are automatically sent every five minutes to a mobile app on the user’s smartphone. Eversense’s implantable sensors last up to 90 days, with the Eversense XL system allowing sensors to last for up to 180 days, which makes using the system much more convenient for diabetic patients.

Senseonics expects to launch Eversense in the U.S. later this year. The company also hopes to introduce the Eversense XL system in Europe in 2018 and begin a pivotal clinical trial of the system in the U.S.

Top 5 Biotech Stocks To Invest In Right Now: Apple Inc.(AAPL)

Apple Inc. (NASDAQ:AAPL) just crushed it again in the last quarter, and along with all the cash it is repatriating, it is what is known as a “GARP” stock. That’s an abbreviation for “Growth at a Reasonable Price.” We don’t want to overpay for growth stocks. It’s easy to do.

AAPL stock has $266 billion of cash and investments, offset by $101 billion in debt on its balance sheet. AAPL will pay up about $40 billion in taxes on that money, meaning AAPL stock has a net cash position of about $25 per share.

With today’s market cap of $949 billion, the market places a value on Apple’s business at $771 billion. With $58 billion in TTM net income, AAPL stock only trades at 13.3x net earnings. Analysts estimate 13% annualized growth going forward.

However, I add a 10% premium for each of these: robust free cash flow, strong cash position and irrefutable worldwide brand name. AAPL stock is a cheap growth stock for retirement.

Top 5 Biotech Stocks To Invest In Right Now: Tesla Motors, Inc.(TSLA)

So when my kids sit down to talk about our Tesla investment with their own young ones, a couple of decades from now, I’d imagine something like this:

When daddy first invested in Tesla, people thought it was a car company. You know, the first lineup of totally electric cars, kicking those antiquated petroleum monsters to the curb. That took a while but nobody buys gas cars anymore. Unless you’re running a car museum, I guess. Tesla really started that changeover, and for a while it really was all about the cars.

But you know, Elon Musk was pretty clear about his long-term goals from the start. The original master plan of 2006 was to keep building more and more affordable electric cars, pushing the entire industry in that direction and setting the stage for a gas-free future.

Musk doubled down on the same basic goals 10 years later and expanded them a bit. At that point, Tesla was working on solar panels and large batteries, moving beyond the car business. Sure, it also worked on self-driving vehicles and a more complete lineup of vehicles back then, forming the financial bedrock under the cross-industry behemoth Tesla would become later.

Here in the 2040s, there’s no real reason to buy cars for your own use and nobody really cares which nameplate is on the self-driving car you hailed today. So Tesla moved on, and now it’s a next-generation energy giant with a finger in every pie from infrastructure and entertainment to sustainable farming and space exploration. As you know, early investors have seen fantastic returns over the decades. I just don’t know how Daddy Moose saw this coming all the way back in the 2010s, but we can thank that long-term vision for half of the wealth he’s passing on to us now.

The details may be wrong, but the overall gist of that story should be on target.

Top 5 Biotech Stocks To Invest In Right Now: Chesapeake Energy Corporation(CHK)

Chesapeake Energy Corporation (NYSE:CHK) shares are punching up and out of a four-month consolidation range, breaking clear of its upper Bollinger Band to close in on its 200-day moving average, which it has not tested since early 2017. This is a reversal of the selling pressure seen in the wake of a downgrade from Citigroup analysts on April 17.

The company will next report results on Aug. 2 before the bell. Analysts are looking for earnings of 12 cents per share on revenues of $1.1 billion. When the company last reported on May 2, earnings of 34 cents per share beat estimates by seven cents despite a 15.4% drop in revenues.

Top 5 Biotech Stocks To Invest In Right Now: MetLife, Inc.(MET)

 Metlife Inc (NYSE:MET) is one of the world’s leading financial services companies, providing insurance, annuities, employee benefits and asset management. The stock currently has a Zacks Rank #2 and a Value Score of A. The 3-5 year EPS growth rate for the stock is estimated at 11.4%.

Top 5 Tech Stocks For 2019

The 10-year U.S. Treasury has crossed the rubicon. It is now flashing a yield that is over the 3% mark. What befalls the economy when that happens? Recession? Correction? A grinding bear market?

Nope. Nothing really. It is more a measure of inflation and economic growth, and far more psychological than it is a real indicator of something significant.

But the kernel of truth that it does represent is a new stage of growth in the economy. The big, safe stocks will keep chugging along, but smaller companies can grow faster than big ones in a faster-paced economy.

That means asset managers — and smart individual investors — will start moving money into small- and mid-cap stocks to take advantage of accelerating growth.

Below are 10 little-known stocks that could be huge in coming years, and now is a good time to establish a foothold, while they’re still cheap and relatively undiscovered. Just remember, these stocks will be volatile, so don’t expect a smooth ride.

Top 5 Tech Stocks For 2019: Apple Inc.(AAPL)

It might be tempting to think that the iPhone is Apple’s swan song and dismiss the company as a has-been, and many investors have long predicted just that. Some have even foretold the death of the iPhone 10, but that ignores the reality.

In the recent earnings release, Apple reported second-quarter records for both revenue and earnings, and Apple CEO Tim Cook said "Customers chose iPhone X more than any other iPhone each week in the March quarter, just as they did following its launch in the December quarter." The company set all-time record sales from the App Store, Apple Music, iCloud, and Apple Pay. The company will likely achieve Cook’s goal of doubling revenue from Apple’s services segment by 2020.

Berkshire Hathaway CEO Warren Buffett, one of the world’s most followed investors, signaled his faith in the company when it was revealed that he had purchased a massive 75 million Apple shares over the past quarter, in addition to the 165 million shares already owned, increasing his stake in the iPhone maker to about 5% of the company’s shares.

Buffett scoffed at the thought of grading the company based on how many phones it sold in a quarter, saying:

Nobody buys a farm based on whether they think it’s going to rain next year or not. They buy it because they think it’s a good investment over 10 or 20 years … The idea of spending loads of time trying to guess how many iPhone X … are going to be sold in a given three month period, to me, it totally misses the point. 

This is a clear indication that Buffet believes that Apple will be a solid investment for decades.

Other reasons to like the company abound. The company raised its quarterly dividend by 16% to $0.73 per share, which is funded by less than 25% of Apple’s profits. The company also announced a new $100 billion share buyback. At current prices, this could reduce Apple’s share count by an additional 10%.

iPhone 8 and iPhone 8 Plus (Product) Red Special Edition.

IMAGE SOURCE: APPLE.

Finally, there’s Apple’s valuation. Even after the stock’s recent run-up, it sells for just 18 times trailing earnings, far below the 25 times for the S&P 500.

A compelling valuation, a solid and growing dividend, significant share buybacks and record-setting results all show why Apple is positioned to grow for the next 50 years.

But don’t take our word for it. Ask Warren Buffett.

Top 5 Tech Stocks For 2019: Hewlett Packard Enterprise Company(HPE)

Hewlett Packard Enterprise is an integrated systems company focused on enterprise offerings like IT solutions, servers, and cloud-based products. The old Hewlett Packard Company might have been more of a “blue chip” by definition, but the spinoff has created new efficiencies for HPE, and investors are getting on board with this Zacks Rank #2 (Buy) stock right now.

HPE currently sports a “B” grade for Value in our Style Scores System, and its P/E, PEG, and P/B ratios all trade at significant discounts compared to its industry. Analysts are also calling for HPE to post EPS growth of 46% in the current fiscal year, and its latest estimates have been trending higher.

Top 5 Tech Stocks For 2019: Mastech Holdings, Inc(MHH)

Little-Known Stocks to Buy: Mastech Digital (MHH)

Source: Shutterstock

 

Mastech Digital Inc (NYSEAMERICAN:MHH) is up 67% year to date and has a market cap of a mere $92 million.

MHH is a 21st century version of a temp firm. It’s a temp firm to IT personnel.

The thing is, millennials and Gen Zers are not looking to be the kind of 9-5 employees that previous generations considered the way to go about a career position.

Coders, devs, systems admins, etc. don’t see systems in a 9-5 world. The tech world is 24/7, so when they work is more flexible and not as predictable. They work around the tech. And that makes Mastech a great draw for talent as well as clients. Plus, many of these jobs are high paying, so Mastech has great margins, since it’s not trying to sell desk jockeys or maintenance workers.

Top 5 Tech Stocks For 2019: Celanese Corporation(CE)

Celanese shares were booming as the company unveiled strong quarterly results.

The company said that for its first quarter, earnings came in at $2.68 per share, or $2.79 per share on an adjusted basis. Analysts were calling for adjusted earnings of 48 cents per share.

From a revenue standpoint, Celanese also impressed, bringing in $1.85 billion for its first quarter, marking a 26% increase compared to the year-ago period. The Wall Street consensus estimate projected revenue of $1.66 billion.

The company’s Engineered Materials segment posted net sales of $665 million for the period, 29% higher than in the year-ago quarter. Both GAAP operating profit of $127 million and segment income of $182 million were all-time highs.

“The on-going success in our businesses gives us confidence that we can grow adjusted earnings per share by 20-25 percent in 2018,” said Mark Rohr, Celanese chairman and CEO.

CE stock was up about 5.7% after the bell today.

Top 5 Tech Stocks For 2019: Buckle, Inc. (BKE)

Even in a sector filled with concerns, and despite having over $4 per share on the balance sheet, Buckle Inc (NYSE:BKE) looks like one of the riskiest plays in retail.

The company is heavily exposed to the tough mall space, with 84% of its locations in shopping malls, per figures from the 10-K. Revenue and earnings are headed in the wrong direction. And as a result, shorts have targeted the stock. A whopping one-third of the float (though closer to 21% of shares outstanding) is sold short at the moment.

With BKE now having more than doubled from its 52-week low, the stock looks dangerous from here, particularly ahead of Q1 earnings this month. But for investors who see the retail sector as oversold, those characteristics all make BKE an intriguing play at this point. A strong Q1 report could squeeze those shorts. Easy comparisons could help growth this year.

And even after the gains over the past year, BKE remains cheap. Backing out its cash, it trades at about 11x EPS. I’d personally rather own FL or other retailers on this list. However, investors more bullish on retail may see it very differently.

And if those investors are right, the short float and recent underperformance suggest BKE may have the most upside of any retail stock on this list.

Top 5 Undervalued Stocks To Watch Right Now

Cryptocurrency mining describes the process by which persons and/or businesses with high-powered computers and servers compete against one another to solve highly complex mathematical equations that are the result of the encryption designed to protect transactions on a blockchain network. The first to solve a group of equations and verify that those transactions (known as a block) are true — i.e., that the same virtual token wasn’t spent twice — receives what’s known as a "block reward." This reward is paid out in tokens of the virtual currency that’s being proofed.

For example, bitcoin currently has a block reward of 12.5 tokens. This means that the first person, group of individuals, or business to validate a block of transactions will receive 12.5 bitcoin tokens. With the world’s most valuable cryptocurrency currently hovering just above $8,000 per coin, we’re talking about a more than $100,000 haul for cryptocurrency miners who are successful in beating others to the proverbial punch.

Though cryptocurrency mining has been profitable, it’s clearly not feasible for everyone. Nevertheless, there are ways investors can gain exposure to crypto mining, should they choose, through the stock market. Here are four top cryptocurrency mining stocks that have either direct or partial exposure, based on sales, to the industry.

Top 5 Undervalued Stocks To Watch Right Now: Amazon.com, Inc.(AMZN)

E-commerce behemoth Amazon helped round out another strong quarter for the FANG stocks last Thursday. The company reported adjusted earnings of $3.27 per share, crushing the Zacks Consensus Estimate of $1.22 per share. Meanwhile, total revenue was up 43% year over year and forecasted Q2 revenue was on the high end of our prior consensus estimate.

Amazon also notched net sales of $5.44 billion in its Web Services unit, marking growth of 49% from the prior-year period and coming in ahead of our consensus estimate. Further, the company reported first quarter physical stores sales of $4.26 billion, underscoring the scope of the Whole Foods acquisition.

Amazon is currently sporting a Zacks Rank #1 (Strong Buy).

Top 5 Undervalued Stocks To Watch Right Now: iRobot Corporation(IRBT)

Shares of iRobot are still reeling from a more than 34% single-day drop in early February, as the market reacted to seemingly disappointing forward earnings guidance from the Roomba maker.

During the subsequent conference call, however, CEO Colin Angle elaborated that the company is purposefully opting to foresake some near-term profits in order to invest in driving top-line growth and maintaining market share in these crucial early stages of its long-term story.

"This is a movement in time where over the next three years the true winners in the consumer robot industry are going to be determined for the next decade," Angle added. He also noted that household penetration in the robotic vacuum market — which comprises the vast majority of iRobot’s current sales — is still "extremely low," in the single-digit percent range, while strong economic conditions are driving healthy global growth for the category.

Even more important, iRobot knows that the consumer robotics industry will grow to represent much more than "just" robotic vacuums. In floorcare, the company is enjoying steady growth for its supplementary Braava jet floor mopping robots. With the help of their fortress-like patent portfolio and sophisticated mapping and navigation technology, management has also spoken at length of their plans to make iRobot’s products the central hubs for enabling smart homes to behave more intelligently in the future.

It’s also developing a robotic lawnmower, which would propel it into a new multibillion-dollar market in the coming years. And Angle has previously revealed that iRobot is further exploring consumer robotic solutions for laundry folding, bathroom cleaning, and loading and emptying dishwashers.

As it stands, iRobot is still a relatively small company with a market capitalization of under $2 billion. But if even a fraction of its ambitious plans come to fruition when our kids are grown, I think it will prove to be a stock that early investors will be more than happy to brag about.

Top 5 Undervalued Stocks To Watch Right Now: Advanced Micro Devices, Inc.(AMD)

Perhaps the most prominent names of the bunch are NVIDIA (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD), which are best known for their graphics card and PC-based microprocessors, respectively. Neither company has exactly been forthcoming with regard to how much of their sales are tied to cryptocurrency mining, but each company has clearly benefited in recent quarters from the sale of graphics processing units (GPU). NVIDIA’s full-year results pointed to 41% year-over-year sales growth, with Advanced Micro’s sales up 25% on an annual basis. 

In fact, demand for GPUs has been so strong that the price of graphics cards, new and old, has been shooting higher. This actually creates a bit of a conundrum for NVIDIA and AMD, as Advanced Micro Devices is more commonly known. The core customers for both companies are avid gaming enthusiasts and enterprise clients. If crypto mining demand continues to pluck supply from the market, the high price for graphics cards could cause a rebellion among NVIDIA’s and AMD’s core customers. Then again, if these companies create a product specifically for crypto mining, they’ll drive down prices by increasing supply and squash the sales and margin boost they’ve recently experienced.

While both companies certainly have a lot going on beyond the cryptocurrency mining industry, it’s possible that their share prices could reflect the ebbs and flows of virtual currency token prices, so it’s something to keep in mind.

Top 5 Undervalued Stocks To Watch Right Now: Apple Inc.(AAPL)

You might be surprised to see that Apple (NASDAQ:AAPL), the world’s largest publicly traded company and a stock that the Oracle of Omaha, Warren Buffett, has come to fancy, was among the leading household names shown the door in Q1. David Tepper’s Appaloosa Management, which initially bought its first stake in Apple back in the third quarter of 2016, sold its entire position of nearly 4.59 million shares. Meanwhile, Larry Robbins’ Glenview Capital Management sold the entirely of its 1.26 million-share stake in Apple during Q1, which it had also held since the third quarter of 2016. As a whole, according to data from Bloomberg, large institutional investors sold 153 million Apple shares in the first quarter.

A woman holding an Apple iPhone X on the beach.

IMAGE SOURCE: APPLE.

Why no love for the king of all tech and consumer stocks? Investors’ angst primarily centers around the belief that Apple’s iPhone sales growth can’t possibly continue at the same torrid pace it’s been on for years. Though iPhone revenue jumped a healthy 14% on a year-over-year basis, to $38 billion in Q1 2018, total units sold rose by a mere 3%, to 52.2 million iPhones. The $1,000 price tag of the newly introduced iPhone X certainly helped push sales higher, but the slow crawl of physical-unit sales is a clear concern among Wall Street pundits. 

Apple’s saving grace has been its incredible shareholder-return policy, which includes the biggest dividend in the world (in terms of total annual payout), and mammoth share buybacks. In fact, the company repurchased $23.5 billion worth of its own stock last quarter, all on the open market, and its board authorized the repurchase of an additional $100 billion worth of stock. These repurchases reduce the company’s existing share count, aiding earnings-per-share (EPS) growth and (presumably) making the company look more attractive from a valuation basis. 

Given that Apple recently raised its dividend by 16% and is valued at only 14 times next year’s EPS, I believe pessimists will be proven wrong over the long run.

Top 5 Undervalued Stocks To Watch Right Now: Netflix, Inc.(NFLX)

Netflix, Inc. (NASDAQ:NFLX) has been on a mission, both in reality and in the stock market. The company’s goal is to become the leader in global streaming. With 125 million customers, it’s well on its way to fulfilling that leadership goal. Heck, its market cap is just $7 billion short of Walt Disney Co (NYSE:DIS).

That puts things in perspective a bit.

But NFLX stock has been even more impressive than the company. It’s up 132% over the past 12 months and 73% since the start of 2018. That’s paved a solid — if also explosive — uptrend for investors. Take note of the chart to see what I mean.

As you can see, Netflix stock has been a beast. Notice that when it started 2018, shares weren’t over $200 yet! Now we’re already over $300. The move has been intense, but so long as the trends stay in place it’s hard to bet against NFLX.

Over its previous highs and above $330, Netflix stock is basing nicely. Momentum is strong and the stock is not yet overbought (blue peaks on the chart). Should nearby support fail, investors would be lucky to gobble up the stock near $300. There should be support near this level, along with the 50-day moving average and a rising uptrend line of support.

Given that the company just beat earnings, revenue and subscriber estimates, as well as provided subscriber guidance that topped analyst estimates, I’d rather be a buyer on dips than a seller on rips.