Tech-heavy Nasdaq Composite (^IXIC -3.94%) The market index has fallen by 20 percent year-on-year, which doubles S&P 500 (^GSPC -3.37%) Market tracker 12% discount.
As a result, some of the most expensive tech stocks of the past are on fire in 2022. And while some truly deserve radical haircuts, others have done nothing wrong and investors should consider buying at today’s modest share prices. .
On that note, there are three tech stocks that look like fantastic buys right now. Will they complement your portfolio? Let’s see.
Intel: Sleeping Giant.
Semiconductor giant Intel (INTC -4.38%) It has been on the ropes in recent years. Management scandals and manufacturing failures have opened up small chip companies Advanced Micro Devices (AMD -6.17%) To leapfrog Intel’s dominant market share, particularly in the lucrative data center market. If you’ve sold your Intel shares in the past five years, I understand.
But you won’t be able to sustain this titan of technology for long. Intel is investing heavily in expanded and improved chip manufacturing facilities, including a $30 billion factory expansion in Chandler, Arizona. The company is many times larger than AD or NVD, and is eager to turn its disproportionate capital stock back into real-world business value.
Meanwhile, Intel stock is trading at a five-year low of 7.5 times earnings or 9.5 times free cash flow at a steep discount. These metrics are well below the 5-year averages of 13 and 16.
The stock offers a generous dividend yield of 4.3%, among the highest yields in the company’s history. With Intel’s stock price low, I recommend locking in those highly effective dividend products.
INTC Dividend Product Information by YCharts
Nokia: Don’t say it back
… because of Nokia (Enough -3.94%) It has been here for years. It just looks a little different than what you’re used to.
The Finnish telecom equipment giant has changed a lot in recent years. Smartphones are currently a hobby for Nokia as the company focuses on the carrier side of the mobile network equation. In important markets such as the US, Taiwan, Mexico and Japan, Nokia is a global leader in 5G network equipment.
These multi-year agreements provide Nokia with a strong operating base from which to deliver consistent top-line sales and improve profit margins even in challenging market conditions. However, Wall Street is not paying attention to this proven technology leader. In the year Nokia shares are down 18% in 2022 and currently change hands at 11 times earnings, or 1.3 times the bargain-bin price after the sale.
And if you thought that switching from mobile handsets to telecom infrastructure was a radical shift in strategy, you probably didn’t know that the same company used to sell paper products and car tires. This company is ready to roll with any punch the market can throw at it, and the stock is incredibly cheap. It’s a surefire recipe for strong long-term returns.
Roku: A pioneer that defines the market
The entertainment industry is changing. I mean, the way people consume movies and TV shows is changing before our eyes. Cable TV, broadcast stations and movie theaters used to rule the roost, but a new crop of digital streaming services are now eating their lunch. So I can advise you to leave the content manager Netflix (NFLX -4.57%) Or a family-friendly veteran Walt Disney (DIS -2.89%) Here, pointing out how digital streams still account for a small portion of content consumption for consumers both domestically and globally. The target market is the size of the planet and the potential for untapped growth is high.
But then you have to pick a long-term winner in the streaming wars. Previous leaders like Disney and Netflix will continue to hold onto their market share for years to come, but you never know when another content creator might burst onto the scene with an incredibly successful catalog.
I don’t want to pick a winner here, so I own both Netflix and Mouse House. At the same time, I also built a great position in the stream technology specialist year (year -6.96%)Because this company will benefit from the growing digital media market no matter who comes out in the content wars.
In addition, Roku has been on the receiving end of Wall Street deals recently. Roku’s stock missed out on the broader market’s modest recovery over the summer, and shares traded at three-year lows today. Critics pointed to a slowdown in ad sales, which caused Roku to fall short of analysts’ revenue and earnings estimates in its second-quarter report last month. But the Bears are making a mountain out of the temporary mole.
“The current economic climate is causing TV advertisers to pause and think about their spending, which will be painful in the short term,” Roku CEO and founder Anthony Wood said on the latest earnings call. But it makes them want more efficiency. [return on investments], which will benefit Roku in the medium and long term. This is reminiscent of the fall of 2008 when advertisers paused spending, but accelerated ad spending from print to digital.
That realization makes a lot of sense. Advertisers are looking for the most efficient marketing platforms, hoping to stretch every ad dollar as much as possible. Lessons learned on both the ad platform and advertiser side of the relationship will be valuable as marketing budgets rise again.
In other words, market makers are punishing the stock because its results look a little weak in the short term, while Roku is currently learning how to generate rich returns in the long term. It’s a sign of mindless buying in my eyes.
Anders Bylund has held positions at Intel, Netflix, Nokia, Roku and Walt Disney. The Motley Fool has spots and recommends Advanced Micro Devices, Intel, Netflix, Roku and Walt Disney. The Motley Fool recommends the following options: long January 2023 $57.50 calls on Intel, long January 2024 $145 calls on Walt Disney, short January 2023 $57.50 puts on Intel. The Motley Fool has a disclosure policy.
