In this article, we will look at the 10 Cheap NASDAQ Stocks To Invest In Now.
How Did The Stock Market Perform In Q3 2024?
The stock market has been following an uptrend since it rebounded from the bear market in Q4 2022. The bear market that ended in Q2 2022 was regarded to be a fed-induced low as the interest rates were high during that time. However, since then the S&P 500 has finished higher in seven out of the eight quarters, including four consecutive quarters of growth. Over the last four quarters, the index has returned 36.3%. This figure is significant because such high return rates were last seen when the market was recovering from 2020 COVID-19 lows.
READ MORE: 8 Best Video Conferencing Stocks To Buy According to Analysts and 10 Best Internet Retail Stocks to Buy Now.
There has been significant stimulus for the bull market to continue ranging from the Fed cutting rates to the China stimulus, and an easing economy with strong data points. Jeremy Siegel, professor emeritus of finance at the University of Pennsylvania’s Wharton School of Business and WisdomTree chief economist shared his note on November 11 talking about the economic landscape and his perception of the election results. He describes last week as one of the most pivotal in recent memory, starting with the Federal Reserve’s decision to cut interest rates by 25 basis points during its November meeting. This decision reflects a cautious approach, as Fed Chair Jerome Powell’s omission of phrases like “further progress” about inflation suggests a recognition that inflationary progress has plateaued. Siegel aligned with Powell’s assessment of rental inflation, indicating that the Fed is now fully aware of disinflationary trends within the housing sector.
Siegel anticipates another rate cut at the December meeting, contingent on upcoming economic data, including the Consumer Price Index (CPI), Producer Price Index (PPI), retail sales figures, and the November jobs report. He notes that if these indicators show weaker-than-expected results, it could increase pressure on the Fed to implement further cuts.
Are We Going To Have A Third Year Of NASDAQ Bull Market?
Over the past 2 years starting from November 16, 2022, the NASDAQ composite has seen a 73% rise during this bull market. Analysts are now debating whether we can have a third year of this bull market or not. To discuss this, Nick Colas, DataTrek Research co-founder, joined CNBC on October 26. Colas thinks that this is a positive sign for the index and that there is still room for the NASDAQ to run higher.
He pointed out that if we look back at 1971 when the index started, since then we have had 10 instances where the index rallied for two straight years. Historic data shows that in six of these 10 times, the NASDAQ index continued to rally for the third year as well and in four instances it didn’t. Colas mentioned that the overall average return of these 10 years was 4.4%, which was not very impressive, however, the lower return rate was due to the 4 losing years when the index failed to rally. The four losing years as pointed out by Colas were 1984, 1987, 1990, and 2011. Three of these 4 years were characterized by crises including the 1987 market crash, the 1990 invasion of Kuwait by Iraq, and the European debt crisis in 2011. If we take these 4 years out of the equation, the overall return for the NASDAQ in year three is 13.3%. Therefore, Colas believes that as long as we don’t have any crisis events, the momentum is historically said to continue in year three.
Colas thinks the index should have at least a 10% return during the third year as historically speaking the index has delivered as much as 20% return rates during the third year. He acknowledges that many analysts think that since we have had two very strong years of growth the third might be a disappointment. However, Colas believes that today’s market environment is much healthier than the one we have had in history, and, based on that, the NASDAQ still has room to run.
With that let’s take a look at 10 cheap NASDAQ Stocks to invest in now.
Photo by Pascal Bernardon on Unsplash
Our Methodology
To curate the list of 10 cheap NASDAQ stocks to invest in now, we used the Finviz stock screener, Yahoo Finance, and Seeking Alpha. We used the screener to get an aggregated list of NASDAQ stocks that are trading below the average Forward P/E of 25.37 (as per Wall Street Journal). Next, we checked the Forward P/E of each stock from Seeking Alpha and earnings growth from Yahoo Finance. Lastly, we ranked the stocks in ascending order, based on the number of hedge funds holding each stock in Q2 2024, as per Insider Monkey’s database.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Cheap NASDAQ Stocks To Invest In Now
10. Telefonaktiebolaget LM Ericsson (NASDAQ:ERIC)
Forward Price to Earnings Ratio: 18.15
Earnings Growth: 9.30%
Number of Hedge Fund Holders: 8
Telefonaktiebolaget LM Ericsson (NASDAQ:ERIC), commonly known as Ericsson, is a Swedish multinational company specializing in telecommunications and networking technology. Founded in 1876, Ericsson provides essential infrastructure, services, and software to the telecommunications industry and other sectors.
The company operates through three main business segments including Networks, IT & Cloud, and Media. It generates revenue by selling hardware for mobile networks including the emerging 5G technologies. Moreover, the company also generates substantial revenue from its managed services and consulting related to cloud infrastructure.
In its recent third quarter of fiscal 2024 report, Telefonaktiebolaget LM Ericsson (NASDAQ:ERIC) emphasized its strategic focus on developing programmable networks that enhance performance and enable new revenue-generating applications. This approach is designed to go beyond traditional consumer mobile broadband by creating new use cases for enterprises and mission-critical operations, which are currently underutilized in revenue generation.
Although the organic sales of the company declined during the third quarter by 1% year-over-year, it was still an improvement subsequently. North America became one of the strongest contenders with a strong 55% growth, driven by significant contract wins. As a result, the gross margins of the company improved from 39.2% during the previous year to 46.3% in Q3 2024. Moreover, EBITDA also improved to $728.66 million from $438 million in the comparable quarter last year.
Telefonaktiebolaget LM Ericsson (NASDAQ:ERIC) also demonstrated strong free cash flow generation capability during the quarter which came at $1.20 billion for the quarter, up from negative $46.71 million during last year. It is one of the cheapest NASDAQ stocks to invest in now.
9. T. Rowe Price Group, Inc. (NASDAQ:TROW)
Forward Price to Earnings Ratio: 12.53
Earnings Growth: 23.70%
Number of Hedge Fund Holders: 28
T. Rowe Price Group, Inc. (NASDAQ:TROW) is an international asset management company that helps people and organizations manage their investments. It offers various investment options including stocks, bonds, and other assets. They also create and manage mutual funds, which are pools of money from many investors used to buy a diversified portfolio of stocks or bonds. The company has clients in more than 55 countries around the world.
T. Rowe Price Group, Inc. (NASDAQ:TROW) generates a major chunk of its revenue from advisory fees it gets from Assets Under Management (AUM). However, recently the company has shifted its focus on expanding its active Exchange Traded Fund (ETF) franchise and its retirement services. It aims to reduce its outflows to half from 2023 levels by excluding a significant sub-advised variable annuity termination and focusing on growth opportunities in retirement and alternative strategies.
The assets management company ended the third quarter of fiscal 2024 with $1.63 trillion in Assets Under Management, up 21.1% year-over-year. As a result of higher assets under the company’s management and higher operating income, the adjusted earnings per share for the quarter came in at $2.57 indicating an 18% increase year-over-year.
In terms of net outflows, the total outflows for the quarter were $12.2 billion, although this was an improvement when compared to last year, however high net outflows remain a challenge for T. Rowe Price Group, Inc. (NASDAQ:TROW). Management aims to reduce net outflows and is hoping for positive funds flow in 2025. Moreover, its equity ETFs have been performing well, with strong sales pipelines and some reduction in net outflows compared to what was initially anticipated.
T. Rowe Price Group, Inc. (NASDAQ:TROW) remains an attractive investment opportunity. Firstly because it has robust fundamentals with top line and bottom line growing 6% during the past decade, and secondly due to its cheap valuation. It is one of the cheapest NASDAQ stocks to invest in now.
8. eBay Inc. (NASDAQ:EBAY)
Forward Price to Earnings Ratio: 12.81
Earnings Growth: 13.90%
Number of Hedge Fund Holders: 38
eBay Inc. (NASDAQ:EBAY) is an international online marketplace that connects buyers to sellers from over 200 countries. The company allows sellers to list items ranging from electronics to collectibles enabling them to sell their items in multiple ways and also offers various advertisement options.
It is one of the cheapest NASDAQ stocks to invest in now. Not only is the stock trading at a forward P/E of 13 but analysts are expecting its earnings to grow by 14% during the year.
eBay Inc. (NASDAQ:EBAY) has been working towards improving the advertisement revenue and payment management system to grow its Gross Merchandise Volume (GMV). During the third quarter results for fiscal 2024, management announced the launching of its redesigned global advertisement platform, which now unifies and simplifies the advertisement experience. As a result of this effort, the company was able to improve its first-party advertising revenue by 15% year-over-year to reach $396 million. Moreover, in addition to improving the advertisement platform the company has also been investing in AI technology. For instance, it launched Magical Listing Tool and Personalized Recommendations making it faster and easier to create detailed, eye-catching listings and get more inventory in front of buyers.
Q3 also turned out to be a successful quarter in terms of revenue and GMV growth. eBay Inc. (NASDAQ:EBAY) grew its revenue by 4% year-over-year to reach $2.6 billion mainly benefitting from its efforts in the advertisement platform. In addition, the GMV of $18.3 billion was also up 2% during the same time, indicating fruitful results for management’s strategic efforts. Moving forward, management is expecting revenue for the fourth quarter to be between $2.53 billion and $2.59 billion.
7. Biogen Inc. (NASDAQ:BIIB)
Forward Price to Earnings Ratio: 10.53
Earnings Growth: 11.50%
Number of Hedge Fund Holders: 46
Biogen Inc. (NASDAQ:BIIB) is a biotechnology company that specializes in developing treatments for serious neurological diseases. The company focuses on treating key target conditions including Multiple Sclerosis, Spinal Muscular Atrophy, Alzheimer’s Disease, and Amyotrophic Lateral Sclerosis.
It has developed several important treatments for each of the key target areas including drugs like TECFIDERA, AVONEX, and TYSABRI that help manage Multiple Sclerosis symptoms. Other notable drugs by the company include SPINRAZA for Spinal Muscular Atrophy and LEQEMBI which helps slow down Alzheimer’s symptoms.
Biogen Inc. (NASDAQ:BIIB) continues to invest heavily in research and development and launched products related to Alzheimer’s disease, rare diseases, and depression during the third quarter of fiscal 2024. The revenue from the product launches helped the company offset the year-over-year decline in Multiple Sclerosis product revenue.
For instance, LEQEMBI’s global market sales amounted to $67 million during the quarter with around $39 million coming from the United States alone. Overall, the net revenue of the company for the quarter was $2.5 billion down 3% compared to the last year. On the bright side, the GAAP EPS of $2.66 was up around 666% year-over-year, indicating ongoing financial adjustments.
The pipeline of Biogen Inc. (NASDAQ:BIIB) looks robust as the company achieved several development milestones during the quarter. For instance, the Dapirolizumab pegol Phase 3 study met the primary endpoint in systemic lupus erythematosus and the company initiated a second phase 3 study for the drug during the quarter.
Management has increased its full-year guidance on the back of recent developments and is now expecting non-GAAP diluted EPS to be between $16.10 and $16.60, representing an approximate 11% growth compared to 2023. President and Chief Executive Officer Christopher A. Viehbacher believes the company is progressing towards its goal of returning to sustainable growth. Biogen Inc. (NASDAQ:BIIB) is one of the cheapest NASDAQ stocks to invest in now.
Patient Capital Opportunity Equity Strategy stated the following regarding Biogen Inc. (NASDAQ:BIIB) in its Q2 2024 investor letter:
“Biogen Inc. (NASDAQ:BIIB) is another name that we believe is underappreciated. As a global biopharmaceutical business, the company is most well known for their products in multiple sclerosis, spinal muscular atrophy, and most recently Alzheimer’s disease. The new CEO, Christopher Viehbacher, is working to improve the company’s pipeline, most recently with their acquisition of Human Immunology Biosciences Inc. in May. Chris has a strong track record of successful M&A and we expect him to continue that tradition. More importantly, we think the market is currently giving the company no credit for success in their Alzheimer’s indication. While the uptake in Leqembi, their Alzheimer’s product, has been slow, we still see strong long-term potential for a patient population that is dramatically underserved. We find the risk/reward extremely attractive.”
6. Charter Communications, Inc. (NASDAQ:CHTR)
Forward Price to Earnings Ratio: 11.57
Earnings Growth: 13.70%
Number of Hedge Fund Holders: 48
Charter Communications, Inc. (NASDAQ:CHTR) is one of the biggest connectivity companies in the United States that provides various connectivity services to more than 37.1 million customers in 41 states around the country. The company operates under the brand name Spectrum and offers broadband internet, television, mobile, and video services to its customers.
With the rise in streaming services, customers have been ditching cable TV to save money. This trend has affected the business of Charter Communications, Inc. (NASDAQ:CHTR) as it continues to lose customers. During the third quarter results for fiscal 2024, the company lost around 9.5% of its Video customers compared to the third quarter of 2023.
Moreover, the company also lost around 110,000 internet customers due to the end of FCC’s Affordable Connectivity Program (“ACP”) in the second quarter. However, regardless of the decline in customers, the company was still able to grow internet revenue by 1.7% year-over-year to $5.9 billion mainly due to promotional rate step-ups and rate adjustments.
To fight the cord-cutting challenge, which is defined as the trend of customers leaving cable TV for streaming services, Charter Communications, Inc. (NASDAQ:CHTR) has announced that it will soon offer its TV Select Video customers streaming subscriptions of up to $80 per month with no extra charges. Management also announced the launch of “seamless entertainment” in the first half of fiscal 2025, which will include Max, Disney+, Peacock, Paramount+, ESPN+, AMC+, Discovery+, BET+, ViX, and Tennis Channel Plus.
Regardless of the challenges it faces concerning customer sentiment its financial fundamentals remain strong. The fiscal third quarter of 2024 came in with a revenue increase of 1.6% year-over-year to $13.8 billion, driven by growth in residential mobile service as it grew its total mobile lines by 29.6% year-over-year during the quarter.
Parnassus Value Equity Fund stated the following regarding Charter Communications, Inc. (NASDAQ:CHTR) in its first quarter 2024 investor letter:
“During the quarter, we added new positions in Pfizer, NICE and Charter Communications, Inc. (NASDAQ:CHTR). NICE is a leading cloud contact center software company. Charter’s stock had fallen due to near-term concerns, which we believe will not have a major impact on the long-term value of the business. Charter Communications has had several issues that created short-term uncertainty. We assessed that these issues have limited impacts on the long-term value of the business and initiated a position to take advantage of the stock’s historically low valuation.”
5. AstraZeneca PLC (NASDAQ:AZN)
Forward Price to Earnings Ratio: 15.86
Earnings Growth: 41.70%
Number of Hedge Fund Holders: 49
AstraZeneca PLC (NASDAQ:AZN) is a leading biopharmaceutical company headquartered in Cambridge, United Kingdom. The company specializes in the discovery, development, manufacturing, and commercialization of prescription medications. The growth trajectory of the company is anticipated to be driven by three key factors, including robust patent protections, economies of scale, and a strong distribution network.
Recently, the company’s supplemental New Drug Application (sNDA) for CALQUENCE (acalabrutinib) received acceptance and Priority Review status in the United States for treating adult patients with previously untreated mantle cell lymphoma. The company has also achieved multiple product approvals across various therapeutic areas, including a recommendation from European regulators for endometrial cancer treatment and acceptance of an application for COVID-19 pre-exposure prophylaxis in immunocompromised patients. Additionally, Tagrisso has been approved in China and Japan as a first-line treatment for EGFR-mutated advanced lung cancer.
Wall Street analysts express optimism regarding the company’s strategic initiatives, particularly its pursuit of acquisitions to enhance growth prospects. Recent acquisitions include Amolyt Pharma and Fusion Pharmaceuticals, aimed at strengthening AstraZeneca’s PLC (NASDAQ:AZN) portfolio and pipeline. The company is also focused on expanding its breast cancer franchise and introducing antibody-drug conjugates into earlier lines of therapy to potentially replace standard chemotherapy.
Management has set an ambitious goal to achieve $80 billion in total revenue by 2030, up from $45.8 billion in 2023. This growth is expected to stem from significant advancements in its existing oncology and biopharmaceuticals portfolio, alongside the launch of approximately 20 new medicines by the end of the decade.
During the third quarter of fiscal 2024, the company improved its top line by 21% year-over-year driven by an increase in demand for its oncology treatments around the globe. The US remained the major contributor to revenue with 43% of global sales coming from the region. Looking ahead management has increased its full-year guidance for 2024 and now anticipates revenue to increase by a high teens percentage.
Parnassus Growth Equity Fund stated the following regarding AstraZeneca PLC (NASDAQ:AZN) in its Q2 2024 investor letter:
“AstraZeneca PLC (NASDAQ:AZN) gained after announcing robust first-quarter results and setting 2030 targets at an Investor Day that were above consensus expectations. We continue to believe that AstraZeneca’s robust pipeline and industry-leading innovation in oncology should support above-expectation revenue growth for the next several years.”
4. Expedia Group, Inc. (NASDAQ:EXPE)
Forward Price to Earnings Ratio: 15.13
Earnings Growth: 22.00%
Number of Hedge Fund Holders: 56
Expedia Group, Inc. (NASDAQ:EXPE) is a prominent online travel company that helps people plan and book their trips. The company operates through three main segments including B2C, B2B, and Trivago. The Business to Consumer (B2C) segment is aimed directly at travelers and runs through well-known brands including Expedia.com, Hotels.com, Vrbo, Orbitz, and Travelocity. All the brands offer a wide variety of travel services, such as booking hotels, flights, car rentals, and vacation packages.
The company has been focusing on unifying its technology infrastructure to enhance user experience. Moreover, management launched the pivotal One Key loyalty program to boost customer retention in the B2C segment. Expedia Group, Inc. (NASDAQ:EXPE) has been gaining some momentum after its technology platforms in 2023. During the most recent quarter i.e. third quarter of fiscal 2024, the company improved its total gross bookings of $27.5 billion by 7% year-over-year. The growth was driven by strong performance in Brand Expedia and Vrbo. As a result, the overall revenue of the company improved 3% year-over-year to $4.1 billion.
While the quarterly performance of Expedia Group, Inc. (NASDAQ:EXPE) is impressive, what’s more attractive is its cheap valuation. EXPE is trading at only 15 times its forward earnings. Moreover, as global travel stabilizes the prospects for the company remain bright. It ranks as the 4th cheapest NASDAQ stock to invest in now.
Aristotle Large Cap Growth Strategy stated the following regarding Expedia Group, Inc. (NASDAQ:EXPE) in its Q3 2024 investor letter:
“Expedia Group, Inc. (NASDAQ:EXPE) contributed to performance in the third quarter. The company reported better-than-expected second quarter earnings in August. The outlook for the year was reduced; however, the stock was trading at under 10x earnings at the time of the outlook reduction. The vacation home rental business Vrbo returned to growth. The significant return of capital continues with the share count having been reduced over the past year.”
3. JD.com, Inc. (NASDAQ:JD)
Forward Price to Earnings Ratio: 10.01
Earnings Growth: 24.10%
Number of Hedge Fund Holders: 59
JD.com, Inc. (NASDAQ:JD) is one of the leading e-commerce companies in China that specializes in online retail and marketplace operations. The company operates through multiple segments including JD Retail, Logistics, and New Businesses.
It generates a great chunk of its revenue, around 90% from its Retail segment. One of the competitive edges of JD.com, Inc. (NASDAQ:JD) lies in its ability to generate record revenues from its retail operations. Over the past 10 years the company has grown its top line by 28.59%.
While Retail remains one of the major contributors to revenue, the company has also developed its Logistics segment by adding new warehouses and delivery network channels to its portfolio. JD.com, Inc. (NASDAQ:JD) released its third-quarter results for fiscal 2024 on November 14, indicating year-over-year revenue growth of 5.1% and net income growth of 47.8% during the same time. Management attributed revenue growth to the rebound in the growth of electronics and home appliances.
Moreover, during the quarter the company also played an important role in China’s trade-in program, which is a government initiative aimed at stimulating consumer spending and promoting economic growth through the replacement of old goods with newer, more efficient products. The program encompasses a wide range of sectors, including automobiles, home appliances, and industrial equipment. JD.com, Inc. (NASDAQ:JD) was able to contribute to the program through its leading supply chain capabilities and fulfillment infrastructure. Moreover, as per the company’s corporate blog, it will invest approximately $420 million to further improve subsidies and services for customers trading in used home appliances and goods. Overall, the Retail segment of the company grew 6% year-over-year and the Logistics segment grew 7% during the same time.
JD.com, Inc. (NASDAQ:JD) is one of the cheapest NASDAQ stocks to invest in now. It is trading at a 47% discount to its sector.
Ariel Global Fund stated the following regarding JD.com, Inc. (NASDAQ:JD) in its first quarter 2024 investor letter:
“We initiated a position in China-based technology-driven E-commerce company, JD.com, Inc. (NASDAQ:JD). The brand has long been known across the region as a superior online shopping channel due to its unique first-party model and unparalleled fulfillment service underpinned by JD Logistics. Yet, a challenging macro environment drove shares lower as shoppers began seeking bargains. In response, the company made significant investments in elevating its third-party merchant platform to enhance its variety of product offerings and price competitiveness for consumers. We believe these actions will yield an improved product mix, stronger top-line growth and margin expansion on a go-forward basis.”
2. PDD Holdings Inc. (NASDAQ:PDD)
Forward Price to Earnings Ratio: 9.94
Earnings Growth: 81.70%
Number of Hedge Fund Holders: 86
PDD Holdings Inc. (NASDAQ:PDD) ranks 3rd on our list of cheap NASDAQ stocks to invest in now. It is trading at a 45% discount to its sector and its earnings are expected to grow by around 82% during the year. The company operates as an e-commerce company owning renowned retail marketplaces such as Pinduoduo and Temu. It has developed a robust e-commerce business model with logistics and a vast seller network in only 10 years since its inception.
As the company competes with established players in the market, it has found its competitive edge in targeting small and medium businesses. This allows its marketplace platform listings to be cheaper than its competitors thereby attracting more customers. During the second quarter of fiscal 2024, PDD Holdings Inc. (NASDAQ:PDD) reached 167 million monthly active customers with more than 50 million customers from the United States.
Moreover, it also improved its top line by a staggering 86% year-over-year to $13.74 billion. Not only this, its operating profits were also up by 156% during the same time to reach $4.48 billion. Robust top and bottom line growth topped with a cheap valuation makes PDD Holdings Inc. (NASDAQ:PDD) an attractive investment opportunity.
Baron Global Advantage Fund stated the following regarding PDD Holdings Inc. (NASDAQ:PDD) in its Q3 2024 investor letter:
“During the third quarter we re-initiated a small investment in PDD Holdings Inc. (NASDAQ:PDD). We believe the company is truly unique in the global e-commerce landscape, with an innovative business model, and very strong growth prospects. Founded in 2015 as Pinduoduo, the company has grown into China’s second-largest e-commerce player, capturing over 20% market share. PDD’s Consumer-to-Manufacturer (C2M) model, which connects manufacturers directly to consumers eliminated intermediaries, allowing for ultra-low prices that attract price-sensitive consumers and small merchants. Its discovery-based, algorithm-driven shopping experience has created a highly engaging platform, driving user and merchant growth in a virtuous cycle. We expect PDD to continue gaining share in China given its dominance in the value-for-money segment, growing branded product offerings at affordable prices, and high operational efficiency. PDD’s network effects and cost advantage, supported by its lean structure and efficient C2M model, are set to grow as it scales, both domestically and internationally. Its cross-border e-commerce platform, Temu, launched in September 2022, has rapidly become one of the world’s fastest-growing apps. Leveraging China’s excess capacity and PDD’s supply-chain efficiency, Temu wields strong pricing power over Chinese suppliers and attracts overseas consumers with competitively priced products. While still in early stage, Temu has achieved 2% of the global ex-China e-commerce market and a variable breakeven in the U.S. market, underscoring PDD’s focus on sustainable growth. Despite its rapid growth and profitability, PDD trades at a double-digit free cash flow yield (despite losses from the early-stage international expansion through Temu), significantly below sector peers. While concerns over geopolitical tensions exist, we believe PDD’s growing competitive edge, strong cash flow, and disciplined management position it to create substantial long-term value for shareholders.”
1. Micron Technology, Inc. (NASDAQ:MU)
Forward Price to Earnings Ratio: 12.57
Earnings Growth: 584.60%
Number of Hedge Fund Holders: 120
Micron Technology, Inc. (NASDAQ:MU) is a leading producer of memory and data storage devices. It is one of the largest producers of DRAM, which is used in computers and servers for quick data access, and NAND flash memory, which is commonly found in smartphones and SSDs (Solid State Drives) for storing data.
The company finds itself at the center of the data centers and AI revolution due to the indispensable use of its storage devices. Keeping up with the demand Micron Technology, Inc. (NASDAQ:MU) is upgrading its product portfolio. For instance, on October 15, the company launched a new line of DDR5 memory modules designed specifically for AI-powered PCs. The new memory modules, called CUDIMM and CSODIMM can operate at speeds up to 6,400 MT/s (mega transfers per second). This speed is more than twice as fast as the previous DDR4 memory and about 15% faster than traditional DDR5 memory without clock drivers.
Following the high demand for its products the company is experiencing record revenue growth. During its fiscal fourth quarter results for 2024, the company reported year-over-year revenue growth of 93% to reach $7.75 billion. The growth was driven by robust demand for AI and data center DRAM products.
CEO, Sanjay Mehrotra mentioned that their NAND revenue was led by record data center SSD sales and exceeded $1 billion in quarterly revenue for the first time. He believes that the company is entering fiscal 2025 with the best competitive position and forecasts record revenues for Q1 of fiscal 2025.
Micron Technology, Inc. (NASDAQ:MU) is the cheapest NASDAQ stock to invest in now. It is trading at only 13 times its forward earnings. Analysts are expecting a staggering 585% earnings growth this year.
Baird Chautauqua International and Global Growth Fund stated the following regarding Micron Technology, Inc. (NASDAQ:MU) in its Q3 2024 investor letter:
“After Micron Technology, Inc.’s (NASDAQ:MU) price appreciated 54% in 1H24, investors became anxious about potential memory weakness, less clear cyclical recovery pace, and whether competitor Samsung will act rationally with capacity expansion. We maintain our long-term positive view on the industry’s demand/supply situation. We believe Micron is well positioned in technology capability, and that its margins will continue to improve.”
While we acknowledge the potential of Micron Technology, Inc. (NASDAQ:MU) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for a promising AI stock that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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