In this article, we discuss the 10 famous tech stocks at a bargain today. To take a look at some more stocks that are trending today and the latest market situation, click 5 Famous Tech Stocks at a Bargain Today.
The specter of soaring inflation, rising interest rates, and disappointing quarterly reports have all combined to push a massive selloff in the technology sector over the past few weeks. The tech-heavy NASDAQ Composite has registered a double-digit drop year-to-date after falling towards the backend of last year as well. A slew of technology stocks have thus lost value in 2022 and are now trading at prices that growth investor Cathie Wood of ARK Investment Management has described as “deep value territory”.
Some of the top tech stocks that investors can buy at a bargain today include Snowflake Inc. (NYSE:SNOW), Zoom Video Communications, Inc. (NASDAQ:ZM), and RingCentral, Inc. (NYSE:RNG), among others discussed in detail below. However, Bank of America analyst Savita Subramanian, in a note to investors in late February, has cautioned that it was important to be “selective” when identifying winners of this crash, noting that it took the tech sector over a decade to recover from the dotcom crash at the turn of the millennium.
Our Methodology
The companies that operate in the technology sector and have registered a more than 10% decline in share over the past month were selected for the list. The analyst ratings and business fundamentals of each company were also considered.
Data from around 900 elite hedge funds tracked by Insider Monkey was used to identify the number of hedge funds that hold stakes in each firm.
Famous Tech Stocks at a Bargain Today
10. Zillow Group, Inc. (NASDAQ:Z)
Number of Hedge Fund Holders: 61
Decline in Share Price Over Past Month: 10.01%
Zillow Group, Inc. (NASDAQ:Z) is a digital real estate firm. Hedge funds have been offloading the stock in recent months. At the end of the fourth quarter of 2021, 61 hedge funds in the database of Insider Monkey held stakes worth $2.2 billion in Zillow Group, Inc. (NASDAQ:Z), compared to 67 in the preceding quarter worth $4.2 billion.
On February 11, Benchmark analyst Daniel Kurnos maintained a Buy rating on Zillow Group, Inc. (NASDAQ:Z) stock and raised the price target to $115 from $105, appreciating new targets set by the CEO of the firm that effectively implied doubling of revenue compared to current analyst forecasts for 2023.
Just like Snowflake Inc. (NYSE:SNOW), Zoom Video Communications, Inc. (NASDAQ:ZM), and RingCentral, Inc. (NYSE:RNG), Zillow Group, Inc. (NASDAQ:Z) is one of the stocks that growth investors are flocking to.
In its Q1 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Zillow Group, Inc. (NASDAQ:Z) was one of them. Here is what the fund said:
“Zillow Group, Inc. (NASDAQ:Z) operates leading U.S. real estate sites, a mortgage marketplace, and the Zillow Offers home-buying business. Shares fell during the quarter in concert with the broader rotation out of technology-based stocks despite the company’s continued inflection in mortgages revenue, strong profitability in its core business, and a positive real estate outlook as Zillow Group, Inc. (NASDAQ:Z) builds out its iBuying ecosystem. In our view, Zillow Group, Inc. (NASDAQ:Z) is a leader in the large online real estate advertising market with substantial upside from mortgages and Offers, and we remain investors.”
9. Paycom Software, Inc. (NYSE:PAYC)
Number of Hedge Fund Holders: 46
Decline in Share Price Over Past Month: 11.41%
Paycom Software, Inc. (NYSE:PAYC) provides cloud-based human capital management solutions. On February 9, DA Davidson analyst Robert Simmons kept a Buy rating on the stock and raised the price target to $420 from $385, noting the firm was an “efficient long-term secular share gainer in the payroll space”.
Hedge funds have been loading up on Paycom Software, Inc. (NYSE:PAYC) as the share price falls. At the end of the fourth quarter of 2021, 46 hedge funds in the database of Insider Monkey held stakes worth $1.3 billion in Paycom Software, Inc. (NYSE:PAYC), compared to 40 in the previous quarter worth $1.4 billion.
In its Q4 2020 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Paycom Software, Inc. (NYSE:PAYC) was one of them. Here is what the fund said:
“Paycom Software, Inc. (NYSE:PAYC) is a cloud-based SaaS provider for human capital management. Its simple yet innovative single-instance software initially targeted small and mid-size businesses, and it is being adopted widely. Paycom Software, Inc. (NYSE:PAYC) has a highly repeatable sales process driven by more than 90% customer retention and a solid track record for selling more to existing customers while acquiring new users. We also like Paycom’s founder/CEO and his impressive track record for value-creating reinvestment. Despite the challenges created by the pandemic, revenue grew 14% in the fourth quarter and for 2020. Additionally, we believe Paycom Software, Inc. (NYSE:PAYC) is well-positioned to benefit from digital transformation as more corporate functions move to the cloud.”
8. Datadog, Inc. (NASDAQ:DDOG)
Number of Hedge Fund Holders: 73
Decline in Share Price Over Past Month: 16.27%
Datadog, Inc. (NASDAQ:DDOG) provides monitoring and analytics services. Elite hedge funds remain bullish on the stock. Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Tiger Global Management LLC is a leading shareholder in Datadog, Inc. (NASDAQ:DDOG) with 5.3 million shares worth more than $944 million.
On February 22, Goldman Sachs analyst Kash Rangan upgraded Datadog, Inc. (NASDAQ:DDOG) stock to Conviction Buy from Buy with a price target of $250, noting the firm was on track to outpace growth in the overall cloud market and expand in spaces like security, affirming that the firm had “multiple vectors for growth”.
In its Q1 2021 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Datadog, Inc. (NASDAQ:DDOG) was one of them. Here is what the fund said:
“We also added to Datadog, Inc. (NASDAQ:DDOG). Shares of Datadog, Inc. (NASDAQ:DDOG) retreated in Q1 in sympathy with the broader information technology sector. However, the company remains on solid fundamental footing, recently setting a quarterly record for net new customer additions. Datadog’s cloud solutions fill a void left by legacy tools built for on-premise IT infrastructures, enabling it to take share in an underpenetrated, large addressable market. We believe the company’s low-touch land-and-expand customer acquisition model, combined with a steady expanding product portfolio, position it well for strong profit and cash flow growth in the coming years.”
7. Teladoc Health, Inc. (NYSE:TDOC)
Number of Hedge Fund Holders: 39
Decline in Share Price Over Past Month: 17.29%
Teladoc Health, Inc. (NYSE:TDOC) provides virtual healthcare services. The company posted earnings for the fourth quarter of 2021 on February 22, beating market estimates on earnings per share and revenue by $0.51 and $7.7 million respectively.
Hedge funds have been selling Teladoc Health, Inc. (NYSE:TDOC) stock. At the end of the fourth quarter of 2021, 39 hedge funds in the database of Insider Monkey held stakes worth $2.4 billion in Teladoc Health, Inc. (NYSE:TDOC), compared to 40 in the previous quarter worth $2.8 billion.
In its Q4 2020 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Teladoc Health, Inc. (NYSE:TDOC) was one of them. Here is what the fund said:
“Teladoc Health, Inc. (NYSE:TDOC) offers remote physician access to patients at home. After experiencing incredible levels of growth throughout the early stages of the pandemic as its unique value proposition rose to the forefront of the healthcare industry, the firm’s shares cooled off a bit as optimistic vaccine data slightly curtailed investor expectations for the firm’s future growth potential. We sold the stock.”
6. PayPal Holdings, Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders: 110
Decline in Share Price Over Past Month: 14.52%
PayPal Holdings, Inc. (NASDAQ:PYPL) provides digital payment services. Hedge funds have been shedding the stock amid a broader lull around growth offerings. At the end of the fourth quarter of 2021, 110 hedge funds in the database of Insider Monkey held stakes worth $9.9 billion in PayPal Holdings, Inc. (NASDAQ:PYPL), compared to 123 in the preceding quarter worth $12.8 billion.
PayPal Holdings, Inc. (NASDAQ:PYPL) recently announced that it was forming a cryptocurrency advisory council to facilitate the setting up of a digital financial system. The company has already integrated crypto payments on the main platform.
In addition to Snowflake Inc. (NYSE:SNOW), Zoom Video Communications, Inc. (NASDAQ:ZM), and RingCentral, Inc. (NYSE:RNG), PayPal Holdings, Inc. (NASDAQ:PYPL) is one of the stocks that elite investors have their eyes on.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal Holdings, Inc. (NASDAQ:PYPL), which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
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Disclosure. None. 10 Famous Tech Stocks at a Bargain Today is originally published on Insider Monkey.
