3 Technology Stocks to Pick this Earnings
The ever-evolving Technology sector witnessed a number of new
trends in 2013. Bring Your Own Device (BYOD), cloud computing, Big
Data, Internet of Things, hybrid cloud, flash storage, social
networking, 3D printing and wearable devices are some of them.
Of these, we expect cloud computing and flash storage to prosper
significantly in 2014. We also believe that the anticipated
stabilization in personal computer (PC) sales will attract
investors in 2014.
Emergence of Hybrid Cloud
Cloud services are expected to grow significantly, as consumers
prefer to use the cloud for storage purposes. Moreover, hybrid
cloud that facilitates interoperability of data between internal
private cloud and public cloud has gained immense importance in
According to market research firm IDC, spending on cloud services
and related technology is expected to jump more than 25.0% to
$100.0 billion in 2014. This presents significant growth
opportunity for established players like
International Business Machines (IBM)
Oracle Corp (ORCL)
, as their legacy businesses continue to shrink.
Flash Adoption To Improve
As consumers' dependence on cloud for storage purpose increases,
demand for cloud-dedicated data centers will increase manifold.
With simultaneous increase in data volumes (1000 Exabytes by 2014)
the demand for flash-based storage systems in data centers will
jump significantly, going forward.
In 2013, flash gained significant prominence as it was included in
servers, hybrid hard disk/flash storage arrays and in all-flash
arrays. According to
2013 survey, 56.5% of IT managers and professionals had already
implemented flash technology in their storage systems.
3 Stocks to Pick from the Pack
The presence of a large number of players makes it difficult to
pick sure-shot winners. By using the Zacks proprietary methodology,
investors can select stocks that have the combination of a
favorable Zacks Rank - Zacks Rank #1 (Strong Buy), 2 (Buy) or 3
(Hold) - and a positive
Zacks Earnings ESP
Zacks Earnings ESP shows the percentage difference between the Most
Accurate estimate and the Zacks Consensus Estimate.
Here are 3 stocks that meet both the criteria:
Oracle Corp (ORCL)
- This Zacks Rank #3 (Hold) company carries an Earnings ESP of
+1.49%. Oracle delivered positive earnings surprises in three of
the last four quarters with an average beat of 2.4%. The company
plans to announce the third-quarter 2014 results by mid-late March.
Oracle is aggressively building its position in the cloud computing
market, which will drive its results, going forward. Accretive
cloud acquisitions, higher subscription revenues and improvement in
sales force hiring rate will drive bookings.
Nimble Storage (NMBL)
- Nimble is a manufacturer and marketer of hybrid flash/disk
storage platform, which also offers backup and replication
software. This Zacks Rank #3 (Hold) stock carries an Earnings ESP
of +5.88% and will report fourth-quarter 2014 results on Feb 27.
Nimble's hybrid storage arrays provide a balanced combination of
performance, capacity, and cost effectiveness, as compared to
all-flash arrays and hard disk drives. Since its Initial Public
Offering (IPO) in Dec 2013, the shares have surged approximately
34.0% driven by a growing customer base, particularly in the small
and medium business segment.
Micron Technology (MU)
- This Zacks Rank #2 (Buy) stock sports an Earnings ESP of +3.39%.
Micron delivered positive earnings surprises in two of the last
four quarters with an average beat of 21.0%. The company is set to
announce its second-quarter 2014 results by late March.
Micron is expected to benefit from improving supply/demand balance
for DRAM and NAND memory chips in 2014. The company's strong
customer base that includes
Intel Corp (INTC)
is a major growth catalyst going forward.
2014 will continue to see the emergence of new disruptive
technologies. Big Data analytics and Internet of Things are
expected to grow into full-fledged services as the year progresses.
Moreover, the anticipated launch of wearable devices will be a
major growth catalyst for the sector, going forward.
MICRON TECH (MU): Free Stock Analysis Report
NIMBLE STORAGE (NMBL): Free Stock Analysis
ORACLE CORP (ORCL): Free Stock Analysis Report
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