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Chicago, IL – April 21, 2025 – Zacks Market Edge is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here: https://www.zacks.com/stock/news/2451007/5-strong-buy-tech-stocks-for-your-short-list)
Welcome to Episode #442 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.
This week, Tracey is going solo to screen for technology stocks. In these volatile times, with the stock market pulling back off its highs, why not find cheap technology stocks that also have the top Zacks Rank of Strong Buy?
Tracey screened for Zacks Rank #1 (Strong Buys). At the time of the podcast, there were only 214 Strong Buy stocks. The top Zacks Rank usually indicates that analysts are revising earnings estimates higher. Investors should look for rising earnings estimates.
To find cheap stocks, she used the PEG ratio. The PEG ratio is determined by taking the price-to-earnings ratio divided over growth. Don't worry, you don't have to figure it out yourself. The screening tool is set up to do that. You just plug it into the screen.
If it's under 1.0, that means the company has both value and growth. That's a rare combination. Tracey decided to use a PEG ratio under 1.50, however, in order to make sure she captured more stocks in the screen.
It found 58 companies.
And then she screened for the Computer and Technology sector on Zacks in order to get only technology stocks.
This screen, with just 3 components, returned just 5 stocks.
1. Broadcom Inc. AVGO
Broadcom is a large cap semiconductor and infrastructure software solutions company. Over the last month, shares of Broadcom have fallen 10.7%.
It has an attractive PEG ratio of 1.4. Broadcom is also shareholder friendly. On Apr 7, 2025, the company announced a new $10 billion share buyback program.
Should Broadcom be on your short list even with all the uncertainty in the semiconductors?
2. CommScope Holding Company, Inc. COMM
CommScope is a global provider of infrastructure solutions for wireless business enterprise and residential broadband networks. It's a small cap company with a market cap of $788 million.
Over the last month CommScope shares have fallen 32.2%. CommScope has a PEG ratio of just 0.2. A PEG ratio under 1.0 usually indicates value and growth.
CommScope is a Strong Buy stock under $5. Should it be on your short list?
3. Dropbox, Inc. DBX
Dropbox is a global collaboration platform. In 2024, it generated free cash flow of $872 million.
Shares of Dropbox are up 4.7% over the last month but it is off its recent 2025 highs. Dropbox has a PEG ratio of 0.9. It maintains its Strong Buy rank.
Should Dropbox be on your short list?
4. InterDigital, Inc. IDCC
InterDigital has contributed foundational wireless, video, and AI technologies essential to daily life. It has a market cap of $5.2 billion, which would make it a mid-cap company.
Shares of InterDigital are down 9.3% over the last month. It has a PEG ratio of 1.29.
While it was a Strong Buy stock when the podcast was recorded on Apr 15, 2025, it has now fallen to a Rank #2 (Buy) stock.
Should InterDigital be on your short list even with the fall in Rank?
5. StoneCo Ltd. STNE
StoneCo is a Brazilian payments, banking, and software company with a market cap of $3.69 billion. It will report first quarter earnings after the market closes on May 8, 2025.
Shares of StoneCo are up 21.7% over the last month but if you look out over the last year, it is down 22.6%. StoneCo is cheap. It has a PEG ratio of 0.4.
Should a foreign company like StoneCo be on your short list?
What Else Do You Need to Know About Strong Buy Tech Stocks?
Tune into this week's podcast to find out.
[In full disclosure, Tracey owns shares of AVGO in the Insider Trader portfolio. She is the editor.]
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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This article originally published on Zacks Investment Research (zacks.com).
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