With fears from an ascending 10-year Treasury Yield starting to calm, markets have stabilized as Nvidia’s NVDA much anticipated Q2 earnings approached.
Opening on a higher note Monday, the Nasdaq was up over 1% again today and a rebound appears to be building after weeks of volatility.
The opportunity to buy several tech stocks that cooled off and had healthy corrections may be upon us and here are a few to consider.
ePlus PLUS: Not just another speculative high-growth tech stock, ePlus offers some nice value to investors at its current levels.
ePlus is also benefiting from increased e-infrastructure spending throughout the economy as a provider of IT infrastructure and supply chain processes. Earlier in the month, ePlus crushed its fiscal first-quarter earnings expectation by 42% with EPS at $1.41 per share compared to estimates of $0.99 a share.
Following the strong Q1 results, ePlus’ stock spiked to a new 52-week high of $75.90 a share before cooling off in recent weeks and currently trading at around $64 a share.
ePlus stock is still up +38% this year and now could be a buy-the-dip opportunity with earnings expected to be up 5% in its current fiscal 2024 and rise another 8% in FY25 to $5.72 per share.
More intriguing, ePlus stock trades at just 11.7X forward earnings which is a very attractive discount to its industry average of 32.3X and the S&P 500’s 20.5X. It’s also noteworthy that ePlus stock trades 49% below its decade-long high of 23.4X and at a 25% discount to the median of 15.8X.
Uber Technologies UBER: The probability of Uber is finally here helping to justify investing in the ride-hailing company for its immense earnings potential.
The road to profitability has been bumpier than competitor Lyft LYFT but Uber’s earnings potential is more lucrative. Unlike Lyft, Uber has a more global reach along with the implementation of food delivery service in its operations.
Intriguingly, Uber’s earnings are forecasted in the black this year at $0.41 per share compared to an adjusted loss of -$4.65 a share in 2022. More impressive, fiscal 2024 earnings are projected to soar another 161% to $1.08 per share.
This growth has lead to much excitement as Uber has worked to lower its operating costs. In correlation, Uber stock has skyrocketed 82% YTD to largely outperform LYFT and the broader indexes. The recent pullback may have been a healthy correction after Uber stock hit 52-week highs of $49.49 a share in late July.
DocuSign DOCU: Lastly, there appears to be an opportunity in DocuSign’s stock which has been overlooked in 2023 and is now down -13%. Still, DocuSign’s business is here to stay as there should be a constant need for its cloud services which digitalize the signing and agreement process.
Steady bottom line expansion is expected with earnings forecasted to jump 23% in DocuSign’s current fiscal 2024 at $2.51 per share versus EPS of $2.03 a share in FY23. Plus, FY25 earnings are projected to rise another 2%.
DocuSign stock may have hit oversold territory over the last few weeks at $48 a share and still 31% from its 52-week highs of $69.45 a share last February.
Takeaway
It’s noteworthy that ePlus, Uber, and DocuSign are expecting expansive top-line growth as well but their stocks have become more compelling with a strengthening earnings outlook.
Reassuringly, this helps reconfirm the excitement most investors have surrounding the expansion capabilities of growing tech companies. At the moment, ePlus, Uber, and DocuSign stock all sport a Zacks Rank #1 (Strong Buy).
ePlus inc. (PLUS): Free Stock Analysis Report
DocuSign (DOCU): Free Stock Analysis Report
Uber Technologies, Inc. (UBER): Free Stock Analysis Report
NVIDIA Corporation (NVDA): Free Stock Analysis Report
Lyft, Inc. (LYFT): Free Stock Analysis Report
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