In this article, we discuss the 12 best Internet-of-Things (IoT) stocks to buy now. If you want to read about some more IoT stocks, go directly to 5 Best IoT Stocks to Buy Now.
The Internet-of-Things (IoT) industry has advanced by leaps and bounds in the past few years, emerging from niche corners of the tech world into the mainstream consciousness of the global business elite. Research by consulting firm Gartner noted that the number of businesses that use IoT technologies had increased from 13% in 2014 to nearly 30% by the end of 2020. Across the world, the use of IoT-connected devices is projected to increase to 43 billion by 2023, an almost threefold increase from 2018.
Conservative estimates place the worth of the IoT businesses to be around $58 billion in 2025. This represents a compound annual growth rate of an explosive 34% from 2020. Some of the top firms expected to benefit from this incredible opportunity include Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), among others discussed in detail below. These firms are investing hundreds of millions of dollars into the development of IoT technology.
Some of the factors influencing this growth include maturing technologies such as artificial intelligence, 5G, and the cloud, as well as the role that IoT plays in reaching sustainability goals. The North American region continues to lead this tech revolution, even as a slower-than-anticipated overall economic recovery, a lack of chipsets, and disrupted supply chains present near-term challenges to the growth of the sector. Looking ahead, advanced principal technologies and a proliferation of devices are fueling the growth of IoT technologies.
Our Methodology
The companies that operate in the Internet-of-Things (IoT) sector were selected for the list. In order to provide readers with some context for their investment choices, the business fundamentals and analyst ratings for the stocks are also discussed. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
Photo by Jonas Leupe on Unsplash
Best IoT Stocks to Buy Now
12. Alarm.com Holdings, Inc. (NASDAQ:ALRM)
Number of Hedge Fund Holders: 20
Alarm.com Holdings, Inc. (NASDAQ:ALRM) provides cloud-based solutions for smart residential and commercial properties in the United States and internationally. It is one of the best IoT stocks to invest in. On October 5, Kohler, a bath and kitchen product innovator, joined Phyn, a leader in intelligent water solutions, to provide their suite of home monitoring solutions to the Alarm.com platform. Both companies said that integration had made it easier for customers to track their water consumption.
On August 11, Maxim analyst Jack Vander Aarde maintained a Buy rating on Alarm.com Holdings, Inc. (NASDAQ:ALRM) stock and raised the price target to $90 from $84, noting that the company’s Q2 results were better than expected across the board.
At the end of the second quarter of 2022, 20 hedge funds in the database of Insider Monkey held stakes worth $140.9 million in Alarm.com Holdings, Inc. (NASDAQ:ALRM), compared to 25 in the previous quarter worth $203 million.
Just like Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), Alarm.com Holdings, Inc. (NASDAQ:ALRM) is one of the best IoT stocks to buy according to hedge funds.
11. Ambarella, Inc. (NASDAQ:AMBA)
Number of Hedge Fund Holders: 27
Ambarella, Inc. (NASDAQ:AMBA) develops semiconductor solutions that enable high-definition (HD) and ultra HD compression in videos, image processing, and deep neural network processing worldwide. It is one of the top IoT stocks to invest in. On June 22, the company announced that the flow systems on chip had been selected by Inceptio Technology, an autonomous driving truck technology and operation company, for its automotive grade central computing platform to deliver level 3 autonomous driving.
On August 31, Stifel analyst Tore Svanberg maintained a Buy rating on Ambarella, Inc. (NASDAQ:AMBA) stock and lowered the price target to $94 from $100, highlighting the company’s roughly in-line quarter and moderate outlook.
At the end of the second quarter of 2022, 27 hedge funds in the database of Insider Monkey held stakes worth $214 million in Ambarella, Inc. (NASDAQ:AMBA), compared to 32 in the preceding quarter worth $319 million.
In its Q2 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Ambarella, Inc. (NASDAQ:AMBA) was one of them. Here is what the fund said:
“Ambarella, Inc. (NASDAQ:AMBA) is a leading supplier of video processing and computer vision chips used in the security and automotive markets. The company continues to face supply headwinds as well as some disruptions among its customers in China related to COVID lockdowns.”
10. Garmin Ltd. (NYSE:GRMN)
Number of Hedge Fund Holders: 30
Garmin Ltd. (NYSE:GRMN) designs, develops, manufactures, markets, and distributes a range of wireless devices. It is one of the premier IoT stocks to invest in. On September 13, the company announced that the G3000 integrated flight deck had been selected by Tactical Air Support for the US Department of Defense Avionics Reconfiguration and Tactical Enhancement for Standardization program. G300 was selected first by Tactical Air’s F-5 adversary aircraft training.
On August 5, Tigress Financial analyst Ivan Feinseth maintained a Strong Buy rating on Garmin Ltd. (NYSE:GRMN) stock and lowered the price target to $165 from $208, noting that the recent pullback in shares was a major buying opportunity for investors.
At the end of the second quarter of 2022, 30 hedge funds in the database of Insider Monkey held stakes worth $385 million in Garmin Ltd. (NYSE:GRMN), compared to 30 in the preceding quarter worth $486.9 million.
9. Emerson Electric Co. (NYSE:EMR)
Number of Hedge Fund Holders: 47
Emerson Electric Co. (NYSE:EMR) is a technology and engineering company that provides various solutions for customers in industrial, commercial, and residential markets. It is one of the major IoT stocks to invest in. The shares of the firm have climbed in recent weeks on the back of reports that the company is in talks with Blackstone, a private equity firm, to sell a part of its commercial and residential solutions business for $5 billion to $10 billion.
On August 16, Bernstein analyst Brendan Luecke assumed coverage of Emerson Electric Co. (NYSE:EMR) stock with a Market Perform rating with a price target of $100, down from $105, appreciating the recent earnings beat of the firm.
Among the hedge funds being tracked by Insider Monkey, Chicago-based firm Citadel Investment Group is a leading shareholder in Emerson Electric Co. (NYSE:EMR), with 2.9 million shares worth more than $233 million.
8. DexCom, Inc. (NASDAQ:DXCM)
Number of Hedge Fund Holders: 56
DexCom, Inc. (NASDAQ:DXCM), a medical device company, focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems. It is one of the elite IoT stocks to invest in. On October 7, the company said that their Dexcom G7 Continuous Glucose Monitoring system was available for people who have diabetes aged two and older in the United Kingdom, Germany, Ireland, Hong Kong and Austria. The firm is also working to launch G7 in South Africa and New Zealand.
On July 29, investment advisory Wells Fargo maintained an Overweight rating on DexCom, Inc. (NASDAQ:DXCM) stock and lowered the price target to $102 from $144. Analyst Larry Biegelsen issued the ratings update.
At the end of the second quarter of 2022, 56 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in DexCom, Inc. (NASDAQ:DXCM), compared to 58 in the previous quarter worth $1.5 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and DexCom, Inc. (NASDAQ:DXCM) was one of them. Here is what the fund said:
“DexCom, Inc. (NASDAQ:DXCM) is the leading provider of continuous glucose monitoring systems for patients with diabetes. The stock fell along with other premium valuation growth stocks, primarily on multiple contraction. Concern about price competition from Abbott Labs’ Libre product also played a role. Results for the first quarter were solid. Sales increased 22% organically, margins expanded 350 basis points, and the company maintained guidance for continued strong results.
An important new and revolutionary product, the G7, was approved and launched in Europe, and the company expects it to be approved in the U.S. soon. The product is 60% smaller, fully disposable, and designed for extended wear. We remain excited that CGM will become the standard of care for Type 1 diabetics and will be used extensively for Type 2 diabetics as well, which we think will be a major driver of continued sales and profit growth well into the future.”
7. Cisco Systems, Inc. (NASDAQ:CSCO)
Number of Hedge Fund Holders: 63
Cisco Systems, Inc. (NASDAQ:CSCO) designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry. The firm has also said that it is planning to start hardware product manufacturing in India.
On August 19, Deutsche Bank analyst Matthew Niknam maintained a Hold rating on Cisco Systems, Inc. (NASDAQ:CSCO) stock and raised the price target to $54 from $51, highlighting that the company’s Q4 results included more constructive messaging around orders/customer demand and top-line trend.
At the end of the second quarter of 2022, 63 hedge funds in the database of Insider Monkey held stakes worth $1.9 billion in Cisco Systems, Inc. (NASDAQ:CSCO), compared to 66 the preceding quarter worth $1.7 billion.
In its Q1 2022 investor letter, Carillon Towers Advisers, an asset management firm, highlighted a few stocks and Cisco Systems, Inc. (NASDAQ:CSCO) was one of them. Here is what the fund said:
“Cisco Systems (NASDAQ:CSCO) traded lower as investors weighed how supply chain concerns would impact sales growth. The company has been upgrading its switching and routing offerings, which should lead to strong demand as on-site locations upgrade infrastructure.”
6. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 65
Intel Corporation (NASDAQ:INTC) engages in the design, manufacture, and sale of computer products and technologies worldwide. On September 8, Deutsche Bank analyst Ross Seymore maintained a Hold rating on Intel Corporation (NASDAQ:INTC) stock and lowered the price target to $35 from $38, noting that the company was expecting Q3 results to come in near the low end of its guidance range.
At the end of the second quarter of 2022, 65 hedge funds in the database of Insider Monkey held stakes worth $2.5 billion in Intel Corporation (NASDAQ:INTC), compared to 76 in the preceding quarter worth $3.2 billion.
In addition to Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Apple Inc. (NASDAQ:AAPL), Intel Corporation (NASDAQ:INTC) is one of the best IoT stocks to buy according to hedge funds.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Intel Corporation (NASDAQ:INTC) was one of them. Here is what the fund said:
“Then, there is the case of Intel Corporation (NASDAQ:INTC). A blue-chip tech champion with a market capitalization of over $500 billion in early 2000, the stock was trading at a P/E multiple of 42. It was a fast-growing company whose stock price and multiple declined more or less in line with its peers. However, unlike Google, Intel’s net income has grown from $7.3 billion in 1999 to $19.9 billion in 2021, a compounded annual growth rate of just 4.7%. Its growth from the dot com era has not proven to be durable, and Intel has yet to trade at the price it attained in 1999.”
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Disclosure. None. 12 Best IoT Stocks to Buy Now is originally published on Insider Monkey.