3 Tech Stocks to Buy Today
Colleen is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Tech companies not named Apple or Samsung might not be top of mind for many right now in the wake of their ongoing patent battles, but that doesn’t mean there aren’t a few ready to add value to your portfolio. Intel, Cisco Systems, and eBay Inc. are three tech companies you should consider buying today.
Intel (NASDAQ: INTL)
Intel fell six percent in August and the company dominates the PC microprocessor arena in today’s post-PC world, so why would you want Intel in your portfolio? The stock is trading at just ten times earnings with an affordable, fair entry price of less than $25 per share. Intel’s second quarter earnings beat expectations, and last but not least, the company offers a 3.7 percent dividend yield making it a good income opportunity.
Perhaps even more important is Intel’s potential to grow and expand into new markets. Mobile will be the key to Intel’s future, and it’s making all the right moves to break into the smartphone and tablet arena in a big way. Chinese phone-maker ZTE recently unveiled a smartphone powered by Intel, joining Lenovo, Orange and Lava International who have all already done so.
Motorola Mobility is expected to announce their own Intel-powered android device this month as well showing a breakdown in ARM’s dominance in the mobile processing field. Intel continues to pour money into research and development, spending $4.6 billion on R&D in Q2 of this year and planning to match that in Q3. Their current mobile processor is running a single core, but Intel plans to unveil a dual core one with LTE or 4G capability in 2013, creating an even greater threat to ARM. Opportunity abounds as the smartphone and tablet markets continue to boom, and Intel is a proven company that makes smart management decisions, making it a great stock to buy.
Cisco (NASDAQ: CSCO)
Cisco is another high dividend-paying tech stock, coming in at an impressive 3 percent yield, to consider adding to your portfolio. The stock has seen a spike since the company’s August 15 earnings announcement that crushed expectations.
Fourth quarter sales of 11.7 billion, a 4 percent year-over-year increase drove a 56 percent year-over-year increase in net income at 1.9 billion GAAP. Earnings per share also enjoyed a 27 percent year-over-year increase in fiscal year 2012. The strong numbers led Cisco to increase its dividend 75 percent to .14 per share, and with the growing cash flow from operations; it could very likely continue to grow.
Cisco, like Intel, is embracing partnerships to ensure its continued success in the future. They’ve announced an expanded partnership with VMware, an industry leader in cloud computing. They’re also working closely with Intel and BMC Software on cloud capable servers and services. As more of our lives and our data shifts to the cloud, this is a great strategic move for Cisco.
eBay (NASDAQ: EBAY)
eBay is a great turnaround story - something that doesn’t happen often in the tech space. It recently released strong results for its 2012 second quarter numbers showing revenue up 23 percent to $3.4 billion compared to the same period of 2011. They also ended the quarter with 113.2 million active registered accounts, a 13 percent increase over Q2 2011.
Embracing partnerships and mobile have saved the day for eBay. In a press release, eBay President and CEO John Donahoe said, “Mobile continues to be a game changer. We now expect eBay and PayPal mobile to each transact $10 billion in volume in 2012 - that’s more than double 2011, a staggering surge in mobile shopping and payments on devices that did not exist just a few years ago.”
A recent partnership with Discover will bring PayPal to brick-and-mortar stores putting them in a good position as we begin the transition to mobile payments. eBay is testing a new same-day delivery service in San Francisco called eBay Now that will allow consumers to have that feeling of instant gratification as packages will be delivered in as little as one hour. Amazon has been rumored to be working on a similar service, so eBay is a step ahead on this one.
While eBay doesn’t provide a dividend like the previous stocks in this post, the potential for the stock to grow as the company pushes its mobile presence, makes this stock one to hold on to.
If you’re looking to add some tech stocks to your portfolio, these three are good bets. Even if you think Apple will continue to be the juggernaut that it is, the high-price entry point of the stock is limiting for some investors. Intel, Cisco and Ebay are each relatively inexpensive stocks that can add lasting value to your portfolio. It doesn’t hurt that company management at each also appears to be making the right strategic moves to ensure continued success and future growth.
ColleenLerro has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend eBay. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.
