MAll stocks are on sale these days. Investors fear the long-term effects of rising inflation and government anti-inflation measures. Furthermore, the market honestly looked overvalued at the end of 2021, so this market correction is welcome even without the inflation-based inspiration.
The price cuts have made many top-tier stocks much more affordable this year. Let’s take a quick look at three tech stocks that deserve your attention at historically low share prices.
I just can’t stop recommending Netflix (NASDAQ:NFLX) these days. The stock has recovered slightly after a solid earnings report in July, but is still trading at some of its lowest levels in four years.
At the same time, Netflix’s business is going from strength to strength, with smaller speed bumps on the road. Market makers tend to treat these minor inconveniences as game-changing obstacles, which is why Netflix stock has gone from a high-flying market darling to an undervalued no-brainer over the past few months.
Netflix has a tremendous market opportunity and is working to make the most of this opening in successful and innovative ways. Among upcoming business initiatives, the company is adding an ad-supported subscription plan, offering mobile games as a free add-on, developing local content in many markets around the world, and experimenting with ways to turn password-sharing freeloaders into additional sources of revenue.
The market doesn’t take Netflix seriously, and this mismatch between shareholder value and market value has created a fantastic buying opportunity.
Two weeks ago, i robot (NASDAQ:IRBT) Stocks hit a low not seen since 2016. The stock is down 35% in 2022 and 52% over the past 52 weeks, and iRobot’s shares are changing hands at an affordable valuation of 0.8 times sales.
I’ll be the first to admit the robotic home helper maker is struggling. End user demand for iRobot products is being constrained by inflation concerns in Europe and North America.
However, the company is showing solid growth in Japan and a modest recovery in the Americas. iRobot faces growing competition around the world but still has a significant advantage in its advanced and battle-tested robot control software.
This company is building a healthy pent-up demand amid the inflation challenge of 2022 and the component shortages of 2021. With sunshine following every rain, iRobot’s downturn should eventually evolve into better days when people finally feel able to spend some money on these helpful cleaning robots. With cash flows close to breakeven and a balance sheet with no long-term debt, iRobot is well-equipped to weather some dark times and come out stronger on the other side.
Chip maker for wireless networks Skyworks solutions (NASDAQ:SWKS) has seen share prices fall 43% over the past year, including a 31% plunge in 2022 alone. You can pick up this stock for the bargain price of 13 times trailing earnings, 9 times expected earnings estimates, or 3.3 times trailing sales . That’s true for stocks in a company with 62% revenue growth and 78% higher earnings per share over the past two years. That sounds like a bargain to me.
The Skyworks management agrees, by the way. The company has invested $740 million in stock buybacks over the past four quarters. The company conducted a similar buyback wave in the summer of 2019, taking advantage of the period’s low stock prices. A year and a half later, Skyworks stock was up more than 150%.
I’m not saying Skyworks’ stock repurchases are a reliable indicator of skyrocketing future returns. Nevertheless, the buybacks are a shareholder-friendly step that also amounts to a long-term vote of confidence.
10 Stocks We Like Better Than Netflix
When our award-winning team of analysts have a stock tip, it can be worth listening. After all, the newsletter they’ve been running for over a decade is Motley Fool stock advisorhas tripled the market.*
They just revealed what they think are the top ten stocks investors can buy right now… and Netflix wasn’t one of them! That’s right — they think these 10 stocks are even better buys.
Check out the 10 stocks
*Stock Advisor returns as of July 27, 2022
Anders Bylund has positions at Netflix. The Motley Fool has positions in and recommends Netflix and iRobot. The Motley Fool recommends Skyworks solutions. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.