Tech stocks didn’t take long to bounce back from a midsummer correction. Some hotter names in tech and AI, like Nvidia (NVDA), look ready to make up for lost time as we enter a historically choppy time for financial markets. Whether we’re talking about the U.S. election, Fed commentary, jobs data, or the latter innings of inflation, there’s no shortage of needle-moving events ahead. Despite these unknowns, ultimately, earnings will help firms gravitate higher, even without much help from the rest of the market.
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In this piece, we’ll use TipRanks’ Comparison Tool to examine three tech stocks – DELL, CRWD, and HUBS – three companies that are still well off their highs after being battered and bruised during the July-August plunge. Let’s examine which of them has the most potential for long-term upside.
Dell Technologies (DELL)
The S&P 500 may be a percentage point away from hitting new highs, but certain technology firms, including Dell Technologies, are still down and out. Undoubtedly, DELL stock got hammered in July and August. Shares have been cut in half, and though Dell is on the mend again (up more than 25% since early-August lows), there’s this sense of unease as the AI beneficiary wanders into earnings later this month (due on August 29, 2024).
I’m inclined to stay bullish with some analysts, including those at JP Morgan (JPM), pounding the table on the stock ahead of its quarterly reveal.
Despite the vicious sell-off in Dell stock, JP Morgan’s analyst team led by Samik Chatterjee, a five-star analyst according to Tipranks’ ratings, had no problem hiking its price target by $10 to $160 last week.
Mr. Chatterjee, who also reiterated the stock as a Buy, believes that the previous quarter’s margin concerns pale compared to the future AI server opportunity. In fact, his team views the AI server market as still in its early innings. In such early stages, it’s all about sales growth. After achieving sales growth, margins become the priority.
Indeed, JP Morgan seems to be right on the money when it comes to Dell. The company is still at the forefront of the AI opportunity, and while not every quarter will be a hit, the firm is playing the long game with AI. Given this, and given DELL shares trade at a bargain with 14.4 times forward price-to-earnings (P/E), I am bullish on Dell Technologies.
What Is the Price Target on DELL Stock?
According to analysts, DELL stock is a Strong Buy, with 12 Buys and two holds assigned in the past three months. The average DELL stock price target of $152.42 implies a 37.7% upside potential.
CrowdStrike (CRWD)
As is the case with DELL, I remain bullish on CRWD stock even if the company still suffers from hangover since the embarrassing and costly IT outage that. The damages from the incident have really added up in recent weeks. And while the firm could continue finding itself hit with more lawsuits, bad press, and the odd price target cut, I’m in the camp that believes CrowdStrike’s big mistake is forgivable. CrowdStrike remains an AI-first company that still has one of the best cybersecurity platforms out there. As such, I stand with the many bullish analysts sticking by their Buy ratings.
Indeed, It’s a bit puzzling why the company didn’t use AI to catch the error before causing a lengthy global digital infrastructure outage. Though some human errors were made, numerous analysts think the firm will recover from its nasty 45% drop. Since August began, CRWD stock has risen 25%, but the firm’s coming quarter (due August 28, 2024) will likely determine where CRWD stock goes next.
D.A. Davidson’s Rudy Kessinger is a notable bull on the name, recently praising the stock for its favorable risk-reward profile ahead of its coming earnings. Mr. Kessinger noted that CrowdStrike “will quickly regain their footing and momentum,” thanks in part to its “still strong reputation” and “best-of-breed” platform. I couldn’t agree more. In a week from now, when quarters are out, the global IT outage will probably be a distant memory as the focus returns to earnings.
CrowdStrike made a mistake but has taken steps to clean up the mess and prevent it from happening again. Therefore, I remain bullish on CRWD stock.
What Is the Price Target on CRWD Stock?
According to analysts, CRWD stock is a Strong Buy, with 30 Buys, six Holds, and one Sell assigned in the past three months. The average CRWD stock price target of $341.58 implies a 28.2% upside potential.
HubSpot (HUBS)
HubSpot (HUBS) is far more than just a bite-sized takeover target for some large-cap tech firm looking to make noise in the enterprise software scene. Though an acquisition by Alphabet (GOOGL) seems off the table now that the behemoth has more than enough attention from U.S. regulators, the tech titan’s interest alone may be enough to warrant giving HUBS stock a second look. As an underrated AI innovator down more than 28% from its highs, I’m compelled to stay bullish like the analyst community, even if further decline is on the cards.
For Q2, HubSpot brought on 11,200 new customers for a grand total of 228,000. As the firm continues investing in its suite of AI tools while being conscious of how every dollar is spent, HubSpot may be one of the efficient AI firms that can achieve respectable returns on investment (ROI) over the medium term. Either way, HUBS stock seems quite cheap (10.5 times price-to-sales (P/S)) relative to its high double-digit growth potential. However, moving ahead, the big question will be whether HubSpot can maintain its growth as it expands upon its margins. I’m predicting it will. Therefore, I’m sticking with a bullish position on HUB stock.
What Is the Price Target on HUBS Stock?
According to analysts, HUBS stock is a Strong Buy, with 20 Buys and four Holds assigned in the past three months. The average HUBS stock price target of $617.15 implies a 26.6% upside potential.
Conclusion
The following three tech stocks are still well off their highs, even as the tech sector recovers from its summer sell-off. Whether we’re talking about Dell and the AI server opportunity, CrowdStrike and its AI-first approach to cybersecurity, or Hubspot and its commitment to balancing efficiency and AI spending, each firm has the means to compensate for lost time. Of the trio, Wall Street sees the most upside (37.7%) in DELL stock.
