If you’re trying to hone in on which tech stocks to buy this month, you’ve come to the right place. The technology sector continues to carry the stock market higher. In just six months, Nvidia (NASDAQ:NVDA) tripled its market valuation to $3 trillion and replaced Apple (NASDAQ:AAPL) as the second most valuable stock (it recently slipped back to third place).
Yet other tech stocks are performing just as good or better than the chipmaker. Software company Dave (NASDAQ:DAVE) has quadrupled in value this year, rising almost 400%. Microstrategy (NASDAQ:MSTR) is up 170%, though that has more to do with Bitcoin (BTC-USD) bubbling up again.
What it shows, though, is significant profit-making opportunities remain in the sector and the following three tech stocks to buy could be the next to explode higher.
Tech Stocks to Buy: Super Micro Computer (SMCI)
Last year’s tech darling Super Micro Computer (NASDAQ:SMCI) is growing slower this year – but not by much. After tacking on 250% gains in 2023, it is “only” 172% higher this time around. But that’s because SMCI stock slipped 37% below the all-time high it hit in March. Now is the time for the next leg up.
Super Micro reported fiscal first-quarter results that beat Wall Street’s top and bottom line estimates but didn’t offer blow-the-doors-off guidance for the rest of the year. The stock market sold off its shares because SMCI’s outlook for the fourth quarter said revenue would only triple from last year to as much as $5.8 billion.
Super Micro Computer is the leading provider of artificial intelligence (AI)-optimized computers, servers, networks, storage solutions and workstations for data centers and other industries. The need for more capacity has hyperscalers like Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) building new data centers all over the country. There will be no lack of demand for Super Micro’s equipment.
SMCI stock earnings are expected to grow a whopping 62% every year for the next five years yet it trades at a fraction of that growth rate. That makes Super Micro Computer a tech stock to buy now.
Palo Alto Networks (PANW)
Cybersecurity expert Palo Alto Networks (NASDAQ:PANW) is another discounted tech stock to buy because it also has no end in sight to its growth potential. Like death and taxes, hackers and cybercrime will always be with us in the connected computer age. LexisNexis Risk Solutions says “human-initiated digital attacks” are up 19% globally from last year.
Yet Palo Alto’s stock is only up 1% in 2024. The market is worried that billings growth is slowing. It rose just 3% in the fiscal third quarter to $2.3 billion. But that resulted from the cybersecurity outfit offering program bundling discounts to existing customers.
It is also benefiting from customers consolidating where they spend their money on security. Rather than numerous different vendors, they are buying more Palo Alto modules under its new, single-platform offering. Particularly with the growth of AI, the cybersecurity leader has new program packages that offer superior protection.
Palo Alto Network’s lower price gives investors the chance to buy into this tech stock at a discount.
ACM Research (ACMR)
Advanced wafer cleaning technologies and equipment (WFE) supplier ACM Research (NASDAQ:ACMR) is another tech stock the market wrongly sold off. Shares are down 38% from its 52-week high though it remains 16% above where it started the year.
Part of the reason for the pullback is ACM’s market is declining, but only through this year. Analysts at Gartner predict the WFE industry will fall 4% this year after a 10% decline in 2023. However, starting in 2025, it will reverse and see 10% growth with significant gains continuing through 2027. It is easy to see why.
Demand for computer chips is growing, especially due to the needs of AI. ACM Research’s equipment is essential because it eliminates contaminants from wafer surfaces at the front end of the chip processing cycle. Chip manufacturers need pristine surfaces before they begin making the wafers.
The specialized nature of its equipment will be necessary as chip companies face secular growth trends. That should push ACMR stock to new heights in the future.
On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
