The market has staged a remarkable rebound in 2023, with many stocks delivering outsized gains on the back of improved sentiment. And given the strong performance, many have feared valuations have become too expensive.
However, that’s not the case for all stocks, including Celestica CLS, StoneCo STNE, and Check Point Software Technologies CHKP. All three sport sound valuation levels and carry solid growth profiles, undoubtedly a positive pairing.
And for the cherry on top, all three have seen their near-term earnings outlooks shift favorably, reflecting optimism among analysts. Let’s take a closer look at each.
Celestica
Celestica is one of the world’s largest electronics manufacturing services companies, serving the computer and communications sectors. Analysts have taken their earnings expectations higher across the board, landing the stock into a Zacks Rank #2 (Buy).
The company’s shares aren’t valuation stretched given its growth trajectory, currently trading at a 10.4X forward earnings multiple. Celestica’s earnings are forecasted to see 20% growth on 9% higher revenues in its current year.
In addition, Celestica has been a consistent earnings performer, exceeding earnings and revenue expectations in back-to-back releases. Just in its latest print, the company delivered a 15% EPS beat and reported revenue 6% ahead of expectations.
The company’s top line has recently seen a growth acceleration.
StoneCo
StoneCo, a current Zacks Rank #2 (Buy), offers an end-to-end cloud-based technology platform to conduct electronic commerce across in-store, online, and mobile channels. Analysts have taken their earnings expectations higher across all timeframes.
The company’s growth profile is hard to ignore, with Zacks Consensus Estimates calling for 130% EPS growth in its current year paired with a 5% revenue uptick. Peeking ahead to FY24, expectations allude to a further 24% uptick in earnings on 10% higher sales.
STNE shares presently trade at a 16.2X forward earnings multiple, nicely beneath 2022 highs of 66.9X and the respective Zacks Internet – Software industry average.
Check Point Software Technologies
Check Point Software Technologies is a well-known provider of information technology (IT) security solutions across the world. Like those above, the stock has enjoyed positive earnings estimate revisions, landing it into a favorable Zacks Rank #2 (Buy).
CHKP shares currently trade at a 16.4X forward earnings multiple, below the 19.8X five-year median and the respective Zacks industry average. Over the last five years, shares have traded as high as 23.9X.
Check Point Software carries a solid growth profile, with earnings expected to expand more than 10% on 4% higher revenues in its current year. The company’s revenue has remained highly consistent.
Bottom Line
Despite the market’s blistering run year-to-date, not all stocks have become expensive.
And for those seeking deals, all three tech stocks above – Celestica CLS, StoneCo STNE, and Check Point Software Technologies CHKP – could be great considerations.
All three sport solid growth projections paired with favorable Zacks Ranks, with the latter reflecting bullishness among analysts.
Check Point Software Technologies Ltd. (CHKP): Free Stock Analysis Report
Celestica, Inc. (CLS): Free Stock Analysis Report
StoneCo Ltd. (STNE): Free Stock Analysis Report
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