2 tech stocks to consider for your smart wallet
Increased volatility caused by macro factors such as the Fed’s hawkish stance to curb rising inflation, Russia’s invasion of Ukraine, labor issues, supply constraints and fears of an impending recession have pushed the United States to the brink of a bear market.
Compounded by these macroeconomic problems, investors are at risk to make sound investment decisions. Additionally, warnings of supply and demand imbalances from several companies and the weak outlook, as well as geopolitical tensions, have thrown investors into troubled waters.
As a result, the S&P 500 (SPX) has fallen by more than 16% since the start of the year. In particular, the technology-rich Nasdaq 100 (NDX) fell 25.65%.
In such a wild environment, it makes sense to make informed investment decisions. Here comes the need for useful tools from TipRanks. TipRanks Smart Portfolio tool is one such tool that helps investors make smart investment decisions by considering many factors such as age, income level, and risk profile.
Moreover, using this tool, investors can compare their portfolios with the top performing portfolios on TipRanks and get important insights.
Technology is the first sector of the best performing portfolios on TipRanks, with an allocation of 50.67%.
Let’s take a look at the fundamentals of two tech stocks included in top performing portfolios.
Salesforce, Inc. (RCMP)
Cloud software giant Salesforce provides software solutions for customer relationship management. Interestingly, 2.7% of the top performing portfolio on TipRanks holds CRM.
With a market capitalization of $186.2 billion, Salesforce is gaining traction in the software industry, with strong consumer demand for its products. Recently, the company released upbeat results for the April quarter and provided a strong earnings outlook on the back of its operational efficiencies.
Looking ahead, Salesforce co-CEO Marc Benioff commented, “While delivering incredible growth at scale, we are committed to consistent margin expansion and cash flow growth as part of our our long-term plan to drive both top line and bottom line performance.
After the first quarter earnings release, Wedbush analyst Daniel Ives maintained a Buy rating and $225 price target on Salesforce. Ives’ price target implies a potential upside of 20.25% over the next 12 months.
The five-star analyst said the company’s results could have provided major relief to investors as they indicated strong demand from core businesses despite the current macroeconomic issues.
With a bullish stance on the tech sector, Ives said, “We continue to believe this bifurcated tech band will be driven higher by software, semi-finished products, cybersecurity and product-focused names (Apple ) as part of this digital transformation…”
Overall, the consensus among analysts is a strong buy based on 29 buys versus four holds. Salesforce’s average price target of $241.03 implies 28.82% upside potential from current levels. However, stocks are down 26.76% year-to-date amid a sell-off on macro uncertainty.
PayPal Holdings, Inc. (PYPL)
Fintech giant PayPal Holdings operates as an online payment system in multiple countries that supports online money transfers. It constitutes 4.21% of the best performing portfolio on TipRanks.
The strong adoption of digital payments is likely to enhance PayPal’s huge network in the global reach of fintech.
While macroeconomic issues, competitive pressure and reduced customer engagement remain near-term headwinds, PayPal presents a long-term outlook. The company’s new offerings, the growing popularity of Venmo’s peer-to-peer payment platform, and integration with Amazon (AMZN) point to the same.
Recently, Mizuho Securities analyst Dan Dolev said, “Our proprietary survey of Venmo and Apple Pay users shows a strong appetite for tap-to-pay with Venmo should Apple open up its NFC to Venmo. ”
“We estimate that tap-to-pay with Venmo could present ~10% POS and 15-20% uplift in revenue given Venmo’s high in-store take rates and attractive funding mix based on the ACH/stored balance,” the analyst added.
Therefore, Dolev maintained a bullish position on the stock with a price target of $120 (upside potential of 42.67%).
Consistent with Dolev’s position, the consensus among analysts currently translates to a strong buy rating, based on 26 buys, five holds and one sell. The average PayPal price prediction of $127.07 implies an upside potential of 51.08% from current levels.
Additionally, Corporate Insiders are positive about the stock. According to the TipRanks Insiders page, company insiders have bought shares worth $694,100 over the past three months.
end of words
Despite the fact that the tech sector as a whole is seeing a massive sell-off, these two tech giants are included in TipRanks’ top-performing portfolio and can therefore be considered wise investments.
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