13 Best Electronic Stocks To Buy Now

Published on February 28, 2024 at 11:07 am by Hamna Asim in Hedge Funds, News

In this article, we discuss 13 best electronic stocks to buy now. If you want to skip our discussion on the electronic components industry, head over to 5 Best Electronic Stocks To Buy Now.

The general electronic components market has experienced strong recent growth, reaching $514.79 billion in 2023 and is projected to grow to $550.59 billion in 2024 at a compound annual growth rate (CAGR) of 7.0%. As per the report from Research and Markets, this growth is attributed to factors like increased disposable income, higher internet penetration, a low-interest-rate environment, and increased investments. The market is expected to continue growing, reaching $708.41 billion in 2028 at a CAGR of 6.5%. Key drivers include a rising demand for electronic components in display devices, IoT growth, and lucrative opportunities. Anticipated trends include 3D printed electronic components, increased merger and acquisition activities, integration of AI and machine learning in manufacturing, adoption of modular connector systems for transportation, and more collaborations. The growth is fueled by increasing demand for specific components like microwave tubes, cathode-ray tubes, X-ray tubes, photoelectric tubes, and triodes in display devices, particularly with the proliferation of smart devices. The Asia-Pacific region, led by China, plays a significant role in this growth, with major contributions from chip designers, chipmakers, and critical components used in various applications.

As the electronic components industry enters 2024, it reflects a pivotal moment marked by recovery from recent geopolitical challenges. Fusion Worldwide’s assessment reveals key themes shaping the industry’s trajectory. The aftermath of extreme shortages, record-high lead times, and pricing fluctuations in 2022 led to significant overbuying in 2023, resulting in substantial excess inventory across different sectors. The rapid evolution of artificial intelligence, expected to contribute $1.3 trillion in growth by 2032, continues to exert a profound influence on market dynamics. Tensions between the US and China persist, stemming from past tariffs on chipmaking and trade, creating a delicate balancing act as China seeks to avert a recession. Additionally, global conflicts in Israel and Ukraine pose threats to the electronic components supply chain, impacting manufacturing, machinery, investment, and consumer confidence.

Per the Fusion Worldwide report, the electronic components industry in 2024 showcases distinct dynamics across different market sectors. In the aerospace and defense sector, there is a robust demand for components supporting builds in both industries. The increasing electrical complexity in commercial airplanes contributes to reliable demand. On the automotive front, the sector faced challenges in keeping pace with the global chip shortage but has regained control, enjoying a generally favorable long-term outlook. However, challenges such as pricing volatility must be navigated. Contract manufacturers are expected to remain a focal point of industry discussions in 2024 and beyond. The industry anticipates an uptick in offshoring activities, particularly in emerging countries, coupled with positive changes in the regulatory landscape driving growth. Enterprise computing and servers emerge as exciting opportunities in the electronic component landscape. The ever-growing need for data and computing positions this sector to reach its full potential, influencing critical areas such as AI, IoT, graphics, multimedia, telecommunications, and beyond. The telecom and networking segment, crucial for enabling AI, IoT, and edge computing, foresees sustained high-margin activities, largely insulated from significant challenges in the long run. In the gaming industry, which faced notable obstacles in 2020 and 2021, a rebound is expected. Graphics cards and GPUs remain significant elements, but the landscape is evolving with the rising popularity of cloud gaming, virtual reality, augmented reality, and AI, sparking demand for more advanced components. In the healthcare sector, where operational expenses are a significant consideration, disruptive technologies hold transformative potential. The adoption of AI, remote patient monitoring devices, and digitized diagnostic equipment could reshape paradigms in the field. While there is reluctance among healthcare centers to incur substantial annual expenses, the sector is poised for change with the advent of groundbreaking applications.

Some of the best electronic components stocks to buy include Flex Ltd. (NASDAQ:FLEX), Corning Incorporated (NYSE:GLW), and Amphenol Corporation (NYSE:APH).

Our Methodology

For this article, we scanned Insider Monkey’s fourth quarter database of 933 hedge funds and picked 13 companies operating in the electronic components industry with the highest number of hedge funds. These companies are involved in the design, manufacture, and production of resistors, capacitors, inductors, diodes, transistors, integrated circuits, microcontrollers, transformers, LEDs, sensors, fuses, and more. These are the best electronic components stocks to buy according to hedge funds. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).

An experienced electronic technician soldering a PCB circuit board.

Best Electronic Stocks To Buy Now

13. TTM Technologies, Inc. (NASDAQ:TTMI)

Number of Hedge Fund Holders: 20

TTM Technologies, Inc. (NASDAQ:TTMI) is involved in the global manufacturing and sale of engineered systems, radio frequency (RF) components, RF microwave/microelectronic assemblies, and printed circuit boards (PCB).

On February 7, TTM Technologies, Inc. (NASDAQ:TTMI) reported a Q4 non-GAAP EPS of $0.41, topping Wall Street estimates by $0.05. However, the revenue came in at $569 million, falling short of market consensus by $3.03 million. In the first quarter of 2024, TTM Technologies, Inc. (NASDAQ:TTMI) anticipates revenues between $530 million and $570 million, compared to the consensus estimate of $555.58 million. The company also projects non-GAAP net income in the range of $0.24 to $0.30 per diluted share, as opposed to the consensus estimate of $0.27 per share.

According to Insider Monkey’s fourth quarter database, 20 hedge funds were bullish on TTM Technologies, Inc. (NASDAQ:TTMI), compared to 17 funds in the prior quarter. D E Shaw is the leading stakeholder of the company, with approximately 2 million shares worth $31 million.

Like Flex Ltd. (NASDAQ:FLEX), Corning Incorporated (NYSE:GLW), and Amphenol Corporation (NYSE:APH), TTM Technologies, Inc. (NASDAQ:TTMI) is one of the best electronic components stocks to buy.

12. Daktronics, Inc. (NASDAQ:DAKT)

Number of Hedge Fund Holders: 20

Daktronics, Inc. (NASDAQ:DAKT) specializes in the design, manufacturing, and marketing of electronic display systems and related products. It operates through Commercial, Live Events, High School Park and Recreation, Transportation, and International segments. The company’s product offerings include video displays, scoreboards, timing systems, message displays, intelligent transportation systems, sound systems, digital billboards, and more. Daktronics, Inc. (NASDAQ:DAKT) is one of the best electronic components stocks.

On December 5, Daktronics, Inc. (NASDAQ:DAKT) reported financial results for the second quarter of fiscal 2024 which ended October 28, 2023. The company posted GAAP earnings per share of $0.05 and a revenue of $199.4 million, up 6.4% year-over-year.

According to Insider Monkey’s fourth quarter database, 20 hedge funds were bullish on Daktronics, Inc. (NASDAQ:DAKT), compared to 16 funds in the prior quarter. Alta Fox Capital Management is the largest stakeholder of the company, with 1.46 million shares worth $12.45 million.

Here is what Singular Research has to say about Daktronics, Inc. (NASDAQ:DAKT) in its Q4 2021 investor letter:

“In December, global markets recovered from November’s omicron scare as Covid worries dissipated given the fact that the new variant has not been as severe or vaccine-resistant as previously anticipated. For the month, we initiated coverage on Daktronics, Inc. (NASDAQ:DAKT). DAKT is the world’s leading supplier of electronic scoreboards, large electronic display systems, and digital messaging solutions for use in sports, transportation, and communication.“

11. Sanmina Corporation (NASDAQ:SANM)

Number of Hedge Fund Holders: 22

Sanmina Corporation (NASDAQ:SANM) is a global provider of integrated manufacturing solutions, components, products, repair, logistics, and after-market services. The company operates in two segments – Integrated Manufacturing Solutions and Components, Products, and Services. Sanmina Corporation (NASDAQ:SANM) is one of the best electronic components stocks to invest in.

On January 29, Sanmina Corporation (NASDAQ:SANM) reported financial results for its fiscal first quarter of 2024 ended December 30, 2023. The company announced a non-GAAP EPS of $1.30, beating market estimates by $0.08. The revenue of $1.87 billion was in line with Street consensus.

According to Insider Monkey’s fourth quarter database, 22 hedge funds were bullish on Sanmina Corporation (NASDAQ:SANM), compared to 24 funds in the prior quarter. D E Shaw is the largest stakeholder of the company, with 625,135 shares worth $32 million.

10. Littelfuse, Inc. (NASDAQ:LFUS)

Number of Hedge Fund Holders: 22

Littelfuse, Inc. (NASDAQ:LFUS) designs, manufactures, and sells electronic components, modules, and subassemblies globally. It operates through three segments: Electronic, Transportation, and Industrial. Its products include fuses, switches, varistors, and diodes, serving industries like automotive, aerospace, and telecommunications. The company also offers solutions for transportation and industrial applications, such as heavy-duty trucks and renewable energy systems. Littelfuse, Inc. (NASDAQ:LFUS) is one of the best electronic components stocks to buy.

On January 31, Littelfuse, Inc. (NASDAQ:LFUS) declared a quarterly dividend of $0.65 per share, in line with previous. The dividend is payable on March 7, to shareholders on record as of February 22.

According to Insider Monkey’s fourth quarter database, 22 hedge funds were bullish on Littelfuse, Inc. (NASDAQ:LFUS), compared to 23 funds in the earlier quarter. Ian Simm’s Impax Asset Management is the biggest stakeholder of the company, with 733,819 shares worth $195.3 million.

Vulcan Value Partners made the following comment about Littelfuse, Inc. (NASDAQ:LFUS) in its Q1 2023 investor letter:

“Littelfuse, Inc. (NASDAQ:LFUS) was a material contributor during the quarter. The company reported favorable results. Margins for the electronics business are elevated compared to the company’s normal targets due to effective price and cost management. Littelfuse’s M&A pipeline is robust, and the company continues to perform well.”

9. Rogers Corporation (NYSE:ROG)

Number of Hedge Fund Holders: 24

Rogers Corporation (NYSE:ROG) specializes in the design, development, and sale of engineered materials and components globally. The company operates through three segments – Advanced Electronics Solutions, Elastomeric Material Solutions, and Other. The company’s products cater to diverse industries, including electric vehicles, wireless infrastructure, aerospace, and industrial applications. Rogers Corporation (NYSE:ROG) is one of the best electronic components stocks. However, in the fourth quarter of 2024, the company reported a Q4 non-GAAP EPS of $0.60 and a revenue of $204.6 million, falling short of market estimates on both accounts.

According to Insider Monkey’s fourth quarter database, 24 hedge funds were bullish on Rogers Corporation (NYSE:ROG), compared to 23 funds in the earlier quarter. Jeffrey Smith’s Starboard Value LP is the biggest stakeholder of the company, with 454,000 shares worth $60 million.

8. Fabrinet (NYSE:FN)

Number of Hedge Fund Holders: 24

Ranking 8th on our list of the best electronic components stocks is Fabrinet (NYSE:FN), a company providing optical packaging, precision optical, electro-mechanical, and electronic manufacturing services across North America, Asia-Pacific, and Europe. On February 5, Fabrinet (NYSE:FN) announced financial results for its second fiscal quarter of 2024 ending December 29, 2023. The company posted a non-GAAP EPS of $2.08 and a revenue of $712.7 million, outperforming Wall Street estimates by $0.05 and $17.31 million, respectively.

According to Insider Monkey’s fourth quarter database, 24 hedge funds were long Fabrinet (NYSE:FN), compared to 30 funds in the earlier quarter. Whale Rock Capital Management is the largest position holder in the company, with 643,227 shares valued at $122.4 million.

FPA Queens Road Small Cap Value Fund made the following comment about Fabrinet (NYSE:FN) in its Q3 2023 investor letter:

“Fabrinet (NYSE:FN) is a contract manufacturer of optical communications sensors and equipment. The company has dominant scale in hard-to-replicate precision-manufacturing technologies and an enviable track record of execution. The majority of sales are to optical communications equipment manufacturers, but Fabrinet has been successfully diversifying into the data center, industrial, auto, and medical end -markets. The stock jumped after reporting June 2023 earnings – data center sales increased 50% sequentially and more than 100% over the previous year, driven by their 800-gigabyte transceivers for Artificial Intelligence applications. The company also announced that Nvidia is a 10%+ customer. Fabrinet was a top-five holding in the Fund before their latest earnings announcement and, although we have trimmed our position, is currently the largest holding. While we continue to evaluate what we believe is a positive step change in the company’s earnings power, we are seeking to take some profits in keeping with our risk management policies.”

7. Universal Display Corporation (NASDAQ:OLED)

Number of Hedge Fund Holders: 28

Universal Display Corporation (NASDAQ:OLED) is focused on researching, developing, and commercializing organic light-emitting diode (OLED) technologies and materials for display and solid-state lighting applications globally. Their offerings, branded as UniversalPHOLED, include PHOLED technologies and materials for displays and lighting products. Universal Display Corporation (NASDAQ:OLED) is one of the top electronic components stocks.

On February 22, Universal Display Corporation (NASDAQ:OLED) declared a $0.40 per share quarterly dividend, a 14.3% increase from its prior dividend of $0.35. The dividend is payable on March 29, to shareholders on record as of March 15.

According to Insider Monkey’s fourth quarter database, 28 hedge funds held stakes in Universal Display Corporation (NASDAQ:OLED), compared to 25 funds in the last quarter. Steve Cohen’s Point72 Asset Management is the largest stakeholder of the company, with 611,020 shares worth $116.8 million.

6. Jabil Inc. (NYSE:JBL)

Number of Hedge Fund Holders: 35

Jabil Inc. (NYSE:JBL) is a global provider of manufacturing services and solutions, operating in two segments – Electronics Manufacturing Services and Diversified Manufacturing Services. The company provides a range of services including electronics design, circuit design, enclosure design, and manufacturing solutions for 5G, wireless and cloud, digital print and retail, automotive, healthcare, and mobility industries.

On January 26, Goldman Sachs reinstated a Buy rating on Jabil Inc. (NYSE:JBL), citing the divestiture of its Mobility business in late December. Analyst Mark Delaney believes that after the divestiture, Jabil presents attractive longer-term earnings per share (EPS) and free cash flow growth opportunities, particularly in markets like hyperscale datacenter, electric vehicles, autonomous driving technologies, renewable energy, and healthcare. Goldman Sachs set a 12-month price target of $141 for Jabil Inc. (NYSE:JBL) shares.

According to Insider Monkey’s fourth quarter database, 35 hedge funds were long Jabil Inc. (NYSE:JBL), same as the prior quarter. Whale Rock Capital Management is the biggest stakeholder of the company, with 1.26 million shares worth $160.6 million.

In addition to Flex Ltd. (NASDAQ:FLEX), Corning Incorporated (NYSE:GLW), and Amphenol Corporation (NYSE:APH), Jabil Inc. (NYSE:JBL) is one of the top electronic components to buy. It ranks 6th on our list.

Artisan Mid Cap Fund made the following comment about Jabil Inc. (NYSE:JBL) in its Q3 2023 investor letter:

“We initiated new GardenSM positions in Wingstop, Quanta Services and Jabil Inc. (NYSE:JBL)during the quarter. Jabil provides outsourced manufacturing services to a diverse set of end markets and customers using its 100+ manufacturing facilities. For two decades, Jabil focused on manufacturing to customer-specified blueprints which inherently carried low margins (2%–3%), a problem further exacerbated by Asian competition. In 2017, Jabil commenced a strategic pivot to focus on manufacturing high-growth, low-volume and high-value products in areas such as health care, industrial, automotive, cloud and 5G infrastructure. We believe moving away from more cyclical consumer electronics markets toward secular growth areas, such as EVs and medical devices, will lead to both faster growth and higher margins. During the quarter, Jabil announced a pending sale of its smartphone manufacturing assets, which meaningfully accelerates this transition.”

Click to continue reading and see 5 Best Electronic Stocks To Buy Now.

AI Fire Sale: Insider Monkey’s #1 AI Stock Pick Is On A Steep Discount

Published on October 30, 2024 at by Inan Dogan, PhD

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A New Dawn is Coming to U.S. Stocks

Published on November 16, 2024 at by Insider Monkey Staff

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