In this article, we discuss 5 under-the-radar tech stocks to buy now. If you want to see our detailed analysis of these stocks, check out 10 Under-The-Radar Tech Stocks to Buy Now.
5. Bumble Inc. (NASDAQ:BMBL)
Number of Hedge Fund Holders: 23
Bumble Inc. (NASDAQ:BMBL) provides online dating and social networking platforms. On August 10, Bumble Inc. (NASDAQ:BMBL) reported a Q2 revenue of $220.45 million, up 18.4% year over year, beating estimates by $1.09 million. Total average revenue per paying user increased to $23.65, compared to $20.88 in the prior quarter. Total paying customers also climbed to 3 million from 2.9 million previously. In Q3 2022, Bumble Inc. (NASDAQ:BMBL) expects total revenue to lie in the range of $236 million to $240 million and Bumble app revenue of $184 million to $187 million.
Susquehanna analyst Shyam Patil on August 11 raised the price target on Bumble Inc. (NASDAQ:BMBL) to $36 from $24 and reaffirmed a Positive rating on the shares. The analyst said the company continues to gain share and is also making strong strides in international expansion. He is optimistic about Bumble Inc. (NASDAQ:BMBL)’s solid niche in the online dating market and its huge potential for growth.
Among the hedge funds tracked by Insider Monkey, 23 funds were bullish on Bumble Inc. (NASDAQ:BMBL) at the end of June 2022, up from 17 funds in the last quarter. Jim Simons’ Renaissance Technologies is the leading position holder in the company, with 898,600 shares worth about $25.3 million.
Unlike mega-caps like Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and NVIDIA Corporation (NASDAQ:NVDA), Bumble Inc. (NASDAQ:BMBL) is one of the under-the-radar tech stocks to watch.
Here is what Polen U.S. Small Company Growth Fund has to say about Bumble Inc. (NASDAQ:BMBL) in its Q1 2022 investor letter:
“Online dating company Bumble delivered strong fourth quarter growth metrics in March. The company has been successfully executing on its core strategic priorities of driving scale and engagement, monetization, and profitability. This is a newer position for us that we opportunistically purchased in the quarter. We are excited about the market potential for online dating, which has been growing in popularity but is still under penetrated in many markets. The stigma related to it has been lessened as a result of the pandemic and general activity should improve as the economy reopens. We think Bumble is competitively advantaged because the company empowers women to make the first move. We believe that Bumble can take share in dating and leverage its brand in other categories.”
4. Varonis Systems, Inc. (NASDAQ:VRNS)
Number of Hedge Fund Holders: 24
Varonis Systems, Inc. (NASDAQ:VRNS) is a New York-based company that offers software products and services to manage, analyze, and secure enterprise data. On August 1, Varonis Systems, Inc. (NASDAQ:VRNS) reported a revenue of $111.45 million, an increase of 26.0% year over year, outperforming estimates by $0.19 million. The annual recurring revenues grew 30% year-over-year to $426.3 million. For Q3 2022, the company expects revenues of $123 million to $125.5 million, versus a $124.35 million consensus, representing a year-over-year growth of 23% to 25%. The full-year 2022 guidance was raised too.
Needham analyst Alex Henderson on August 2 maintained a Buy recommendation on Varonis Systems, Inc. (NASDAQ:VRNS) and lowered the price target on the shares to $35 from $75. The company posted a robust Q2 with revenues up 26% year-over-year, topping the Wall Street forecast despite stronger than expected foreign exchange headwinds, the exit from Russian operations, and a weakening Shekel, the analyst told investors in a research note. The pipeline is strong and upsell healthy even as management observed higher scrutiny for deals in Europe, the analyst contended.
According to Insider Monkey’s data, 24 hedge funds were long Varonis Systems, Inc. (NASDAQ:VRNS) at the end of June 2022, compared to 26 funds in the last quarter. Tremblant Capital is the leading position holder in the company, with 2.4 million shares worth about $71 million.
3. Upwork Inc. (NASDAQ:UPWK)
Number of Hedge Fund Holders: 25
Upwork Inc. (NASDAQ:UPWK) is a California-based company that operates a marketplace for freelancers, connecting businesses with independent professionals and agencies. On July 27, Upwork Inc. (NASDAQ:UPWK) reported a Q2 revenue of $156.9 million, up 26.3% year over year, exceeding market consensus by $9.12 million. The company raised its full-year 2022 revenue guidance to between $612 million and $617 million, versus a consensus of $597.04 million. This represents a 22% year-over-year growth at the midpoint.
On July 28, JMP Securities analyst Andrew Boone maintained an Outperform rating on Upwork Inc. (NASDAQ:UPWK) and lowered the price target on the shares to $33 from $45. The company’s Q2 results were “solid” as gross services volume was slightly under forecasts but revenue outperformed estimates by 6%, the analyst told investors.
According to Insider Monkey’s Q2 data, Upwork Inc. (NASDAQ:UPWK) was part of 25 hedge fund portfolios, compared to 26 funds in the last quarter. David Brown’s Hawk Ridge Management is the leading position holder in the company, with 3.35 million shares worth $69.4 million.
2. Clarivate Plc (NYSE:CLVT)
Number of Hedge Fund Holders: 31
Clarivate Plc (NYSE:CLVT) is a London-based information services and analytics company. On August 9, the company posted a Q2 non-GAAP EPS of $0.22, beating market estimates by $0.02. The revenue of $686.6 million climbed 54.1% year over year. However, the revenue fell short of Wall Street consensus by $4.3 million.
Wells Fargo analyst Seth Weber on July 12 initiated coverage of Clarivate Plc (NYSE:CLVT) with an Overweight rating and a $20 price target. Although currency and macro headwinds present potential challenges, fiscal 2022 consensus estimates are already at the low end of Clarivate Plc (NYSE:CLVT)’s guidance, the analyst told investors in a research note. He said the stock’s valuation presents an attractive risk/reward given the company’s science and intellectual property, as well as “considerable progress” over the last few years in terms of portfolio, operations, and costs.
Among the hedge funds tracked by Insider Monkey, Leonard Green & Partners is the largest shareholder of the company, with 116.6 million shares worth $1.6 billion. Overall, 31 hedge funds were long Clarivate Plc (NYSE:CLVT) at the end of Q2 2022, compared to 36 funds in the prior quarter.
Here is what ClearBridge Select Strategy has to say about Clarivate Plc (NYSE:CLVT) in its Q3 2021 investor letter:
“We took advantage of alternative asset classes to establish exposure in healthcare analytics firm Clarivate. Clarivate sells a range of analytics and data packages to biopharmaceutical and medical technology customers. The common stock had come under pressure due to disappointing medium-term growth guidance and a large secondary offering of convertible securities. We purchased the mandatory convertible shares, which pay an attractive yield, as we wait for the company to rebuild its credibility with investors and convert to common equity in the low $30s.”
1. Qualtrics International Inc. (NASDAQ:XM)
Number of Hedge Fund Holders: 32
Qualtrics International Inc. (NASDAQ:XM) is an American company that operates an experience management platform to manage customer, employee, product, and brand experiences. On July 20, Qualtrics International Inc. (NASDAQ:XM) reported a Q2 revenue of $356.37 million, up about 43% year over year, topping market estimates by $11.52 million.
HSBC analyst Antonin Baudry on August 9 reiterated a Buy rating on Qualtrics International Inc. (NASDAQ:XM) but lowered the price target on the shares to $20 from $40. The company’s momentum remained solid in Q2 and its 30% discount to cloud peers seems unjustified, the analyst told investors. He noted that Qualtrics International Inc. (NASDAQ:XM)’s earnings for the first half of 2022 was ahead of consensus and visibility on Q3 supports guidance for the full year.
According to Insider Monkey’s data, 32 hedge funds were long Qualtrics International Inc. (NASDAQ:XM) at the end of Q2 2022, up from 30 funds in the last quarter. Silver Lake Partners is the biggest stakeholder of the company, with roughly 25 million shares valued at $312.5 million.
Here is what VGI Partners has to say about Qualtrics International Inc. (NASDAQ:XM) in its Q4 2021 investor letter:
“Our analysis shows Qualtrics is the world leader in experience management (EM) software. EM software is a category that has been turbocharged by the pandemic as corporations and governments are striving to better understand their customers and employees in order to improve satisfaction, retention and in turn maximize the dollar return on each customer. Customer experience was previously assessed via surveys and other forms of analog feedback. Today Qualtrics allows its clients to assess their customers’ feedback and improve the experience with more sophisticated tools (e.g. Net Promoter Scores) and in real time via multiple data feeds which include call center conversations, emails, online chatbots, social media feeds and so on.
A good example of a Qualtrics customer is JetBlue Airlines, a major American low-cost airline. JetBlue uses the platform to analyze customer feedback and in turn better tailor pricing for flights and also improve the in-flight experience, in order to expand Net Promoter Scores (NPS) and increase customer retention through this real-time feedback. For example, by combining flight frequency and pricing studies, JetBlue found that 82% of their passengers didn’t care about free bags and instead preferred cheaper ticket prices. JetBlue responded by rolling out different rate structures and pricing options for passengers, which were well received. By taking a deep dive into passengers’ feedback in Philadelphia, JetBlue was able to trace dissatisfaction to the lack of airport shops and amenities open early in the morning, where JetBlue responded quickly by simply passing out water, juice, and coffee at the gate to boost customer satisfaction.
Large corporations are accelerating their usage of Qualtrics software with 85% of the Fortune 100 using the platform. The incremental spend with Qualtrics by existing customers is impressive and continues to grow in excess of 20%. This is underpinned by expanding usage along with the adoption of additional modules which allow clients to gain greater depth and breadth of data from the Qualtrics platform. In addition, new customers add to the growth of existing customers resulting in what we believe will be revenue growth of over 30% p.a. over the coming years…” (Click here to see the full text)
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