If you’re looking for tomorrow’s investment winners, the technology sector is one of the best places to start. It has spawned many market-stunning stocks over the past few decades, and artificial intelligence (AI) is a huge opportunity that could create massive wealth for investors in the years to come.
Here are two tech stocks ripe for the picking in November.
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Shares of Micron technology (NASDAQ:MU) rose to a high of $157 earlier this year before rebounding to around $100 at the time of this writing. That dip has made the stock’s valuation even more attractive, as the most recent earnings report continued to show rising demand from data centers for the company’s high-capacity memory products.
Micron has seen a sharp recovery in its revenue over the past year. In the fourth quarter of 2024 ended August 29, revenue increased 93% year over year, showing that the company’s growth is accelerating. Strong demand developments are driving margins higher, meaning Micron’s earnings per share have more than doubled compared to the same quarter last year.
Profits should continue to grow as Micron shifts more production to higher-margin products such as high-bandwidth memory, where demand is expected to rise in the new year. Management sees demand coming from AI and traditional servers, indicating broad strength in the data center market.
Micron is ramping up production as much as possible to meet demand, as supply is the main factor limiting sales. This will significantly benefit the company’s margins. On average, Wall Street analysts currently expect Micron’s adjusted earnings per share to rise from $1.30 in fiscal 2024 to $8.93 in fiscal 2025, according to Yahoo Finance.
In light of these trends, the stock’s valuation looks attractive, at just eleven times next year’s earnings. Compared to the expected results for the fiscal year 2026, the stock has an even cheaper price-to-earnings ratio (P/E) of 8. Micron shareholders are looking at potentially substantial upside in the coming years.
HubSpot (NYSE: HUBS) provides an easy-to-use platform for small businesses to manage services, marketing and sales. It has achieved robust growth in recent years and delivered phenomenal returns for its investors. The stock is up 18% since the company reported its third-quarter results in early November.
Revenue grew 20% on a constant currency basis in the third quarter, driven by net 10,000 new customers – bringing the total number of customers to 238,000 – and continued spending from established customers. It reported strong customer interest in new AI features, such as a new Copilot assistant, which is currently in beta testing.
These were solid results during a relatively weak year of growth for leading software vendors. Companies have been hesitant to spend money on software, but HubSpot has risen to the challenge. While it expects fourth-quarter revenue growth to slow again to around 16% annualized, Wall Street is starting to give the company more credit for its long-term opportunities and ability to improve margins.
HubSpot is showing signs of building a sustainable competitive position. Adjusted operating margin improved from 16.5% in the third quarter of 2023 to 18.7% in the third quarter of 2024. This was an excellent performance following management’s decision to lower prices to win more customers. It demonstrates the ability to be competitive on pricing while still growing profits, which helps explain why shares are rising.
On a price-to-sales basis, the shares still look attractive at a multiple of 14. The stock is up more than 2,000% since its IPO in 2014, but the average price-to-earnings ratio over the past ten years has been just over 12. With HubSpot still in growth mode, investors can anticipate returns consistent with the company’s long-term revenue growth.
Have you ever felt like you missed the boat on buying the most successful stocks? Then you would like to hear this.
On rare occasions, our expert team of analysts provides a “Double Down” Stocks recommendation for companies they think are about to pop. If you’re worried that you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
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Nvidia: If you had invested $1,000 when we doubled in 2009, you would have $368,053!*
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Apple: If you had invested $1,000 when we doubled in 2008, you would have $43,533!*
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Netflix: If you had invested $1,000 when we doubled in 2004, you would have $484,170!*
We’re currently issuing ‘Double Down’ warnings for three incredible companies, and another opportunity like this may not happen anytime soon.
See 3 “Double Down” Stocks »
*Stock Advisor returns November 18, 2024
John Ballard has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends HubSpot. The Motley Fool has a disclosure policy.
2 Top Tech Stocks to Buy in November was originally published by The Motley Fool
