7 Tech Stocks That Could Make Huge Moves in December
Although tech stocks represented one of the worst-hit sectors in the malaise that is 2022, a few of these tech stocks to buy could make a surprising comeback in Dec. While it’s no guarantee, the festive holiday spirit seems to have lifted moods. As an example, the technology-centric Nasdaq Composite posted a gain of 3% in the trailing month. True, that’s not a performance to write home about. At the same time, it demonstrates that the sharp losses that tech stocks incurred have been at least temporarily arrested. Now, the sector needs to pull off some key victories, which may lift broader investor sentiment. From there, who knows what can happen?
For this list, I’m going to focus on generally underappreciated tech stocks. Fundamentally flying under the radar, these market ideas own the necessary ingredients for huge moves: relevant businesses, relatively strong financials, and a dose of underdog energy.
|KLIC||Kulicke and Soffa||$47.09|
|SIMO||Silicon Motion Technology||$61.25|
Tech Stocks to Buy: Kulicke & Soffa (KLIC)
Based in Singapore, Kulicke & Soffa Industries (NASDAQ:KLIC) doesn’t get much attention from stateside investors. However, that could change quickly. While KLIC represents one of the hard-hit tech stocks – suffering a 27% loss on a year-to-date basis – it also received near-term momentum. In the trailing five days, shares gained almost 9% while over the trailing month, they’re up over 14%.
Fundamentally, KLIC should prove incredibly relevant. Per its public profile, the company is a leading provider of semiconductor, LED, and electronic assembly solutions serving the global automotive, consumer, communications, computing, and industrial markets. Unless you anticipate that these sectors will suffer a substantial loss of demand, KLIC should be able to keep on running. On a financial level, KLIC draws intrigue because of its business profile. Currently, the market prices KLIC at 6.65 times trailing 12-month earnings. In contrast, the industry’s median price-earnings ratio pings at 17.4 times.
Tech Stocks to Buy: Silicon Motion Technology (SIMO)
Based out of Taiwan, Silicon Motion Technology (NASDAQ:SIMO) naturally suffered from both the malaise impacting tech stocks and geopolitical pressures. With tensions sky-high between China and Taiwan, SIMO doesn’t provide much confidence. As a result, shares gave up over 35% of equity value since the start of the year. At the same time, SIMO gained almost 16% in the trailing month, reflecting rising near-term momentum heading into Dec.
Fundamentally, Silicon Motion draws attention because it specializes in developing NAND flash controller integrated circuits for solid-state storage devices. According to experts in the field, the global solid-state drive market might reach $175.9 billion by 2030 from $40.7 billion in 2021. This translates to a compound annual growth rate (CAGR) of 17.6%. On a financial level, SIMO represents one of the top tech stocks that could make big moves in Dec. because of resilience. Per Gurufocus.com, the company carries zero debt, affording it incredible flexibility during these uncertain times.
Tech Stocks to Buy: CoreCard (CCRD)
Headquartered in Norcross, Georgia, CoreCard (NYSE:CCRD) absorbed a sizable hit similar to other tech stocks. Currently, shares fell over 22% since the January opener. However, CCRD features a market capitalization of only $254.5 million. As one of the smaller firms, it capitalizes on broader positive sentiment. Sure enough, in the trailing month, CCRD gained nearly 33%.
That’s hefty momentum heading into Dec. As well, the fundamentals could serve the company well. Specifically, CoreCard focuses on the card management system, delivering powerful and integrated solutions for any type of card-issuing program. According to one research paper, the card management system market could hit $39.77 billion in 2027. Another reason to keep tabs on CCRD as one of the tech stocks to buy centers on its income statement. Presently, CoreCard’s three-year revenue growth rate stands at 34.6%, beating out 88% of its peers. As well, its net margin is 23.2%, above 93% of the industry.
Skyworks Solutions (SWKS)
Perhaps one of the more attractive tech stocks poised for big moves in Dec., Skyworks Solutions (NASDAQ:SWKS) nevertheless represents a contrarian argument. At the moment, prospective investors are staring at a loss nearing 41%. However, in the trailing half-year period, SKWS cut this loss to only 6.6%. Part of the recovery stems from significant near-term momentum. In the trailing month, shares are up 9.6%.
A semiconductor firm, Skyworks manufactures chips for use in radio frequency and mobile communications systems. Obviously, these segments command serious relevance, affording a long upside pathway for SWKS. For example, just the 5G Internet of Things market could reach a valuation of over $297 billion by 2030. While many reasons to bet on SWKS exist for contrarians, a top consideration focuses on an excellent value. Currently, the market prices SKWS at 9.2 times forward earnings. In contrast, the underlying industry’s forward PE ratio pings at 18 times.
Lam Research (LRCX)
Arguably one of the more overlooked tech stocks, Lam Research (NASDAQ:LRCX) so far is getting a raw deal from Wall Street. As I write this, LRCX stock gave up over 36% of its equity value. However, in the trailing six months, LRCX managed to cut this loss to only 5.4% down. Further, in the trailing month, shares gained more than 21%. Again, that’s plenty of momentum to carry into Dec. Fundamentally, Lam Research supplies wafer fabrication equipment and related services to the semiconductor industry. As you might suspect, the company commands serious relevance. Per Allied Market Research, experts project that the global semiconductor wafer market will reach a valuation of $27.13 billion by 2030.
Financially, Lam brings excellent income statement metrics. Its three-year revenue growth rate (26.6%) and net margin (27%) both rank among the sector’s upper echelons. Also, the market prices LRCX at 13.3 times forward earnings. For context, the median forward PE for the industry is 18 times.
Cirrus Logic (CRUS)
Headquartered in Austin, Texas, Cirrus Logic (NASDAQ:CRUS) might not represent a household name among tech stocks. However, it deserves closer inspection for those seeking a smart but overlooked market idea. While shares slipped over 18% of equity value since the start of the year, they’ve gained over 12% in the trailing month. Also, in the past five sessions, CRUS jumped 6%.
Therefore, the momentum looks enticing just ahead of the Dec. sessions. Fundamentally, Cirrus focuses on supplying low-power, high-precision mixed-signal processing solutions for mobile and consumer applications including smartphones, tablets, truly wireless headsets, wearables, laptops and augmented reality/virtual reality headsets. The latter could be intriguing for Cirrus because sales for the combined segment could reach over $52 billion by 2027. This compares favorably to the $10.5 billion the sector may hit by the end of this year.
For investors, CRUS represents an all-around solid play among tech stocks to buy. Backed by a stable balance sheet, the company offers solid revenue trends and profit margins. Additionally, the company’s undervalued, priced at less than 15 times forward earnings.
Sapiens International (SPNS)
For those that want to dial up the risk-reward factor in their prospective tech stocks, Sapiens International (NASDAQ:SPNS) may draw intrigue. Based in Israel, SPNS features a market cap of $1.1 billion, right on the cusp of a small and medium-sized enterprise. Since the start of the year, SPNS dropped over 45% in equity value. In the trailing half-year period, it cut this loss down to 18%.
Of course, that’s not a positive figure. And in the trailing month, shares are actually down 2.6%. Therefore, you’re taking a heavier risk here. Nevertheless, the fundamentals entice, with Sapiens specializing in computer software for the insurance industry. After the horrors of the coronavirus pandemic, people are much more attuned to insurance products to protect their financial well-being.
Financially, investors may point to Sapiens’ three-year revenue growth of 12.8% as an attractive attribute. Also, the company’s undervalued against the price-earnings-growth (PEG) ratio, which stands at 0.72 times as opposed to the sector’s median stat of 1.52 times.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.
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