Thursday, 19. October 2017  
29.09.2016 04:56
Author: Nic Wright

STOCK SCREEN: Technology Stocks With Above Average Valuation Upside

 

While global growth has been only moderate for the past 10 years with various headwinds from demographics, low productivity growth and the aftermaths of the financial crisis, there is currently lots of dynamic around the Fourth Industrial Revolution theme.

 

The IT-sector is growing dynamically in the fields of sensor networks, cloud computing, IoT, Big Data, cyber security, advanced robotics, automated driving and 3D printing. The semiconductor industry, which we highlighted two months ago, seems to reflect this dynamic as well, as companies in the sector are rapidly preparing themselves for the digitalization of industries: GE's recently offered to buy Sweden’s Arcam AB and Germany’s SLM Solutions Group AG, both are 3-D printing companies, in separate transactions worth $1.4 Billion. Also Qualcomm reportedly is in acquisition talks with NXP Semiconductors, to augment its business of wireless chips and patent licenses with the products of one of the world's top makers of automotive electronics.

 

In looking for ideas this week, we screen the sector for stocks with solid upside to our AVM’s intrinsic value estimate and relative price strength.

 

These are the exact filter criteria we used:

 

1. Market capitalization above 1bn.

2. 10 percent plus Upside to fair value based on our AVM’s Greenblatt valuation approach.

3. Relative Price Strength over 12 months.

 

Here is our list of stocks matching all criteria in alphabetical order. Company names in the table below are linked to the ANALYZER, our single stock analysis tool. Intrinsic Value Model assumptions can be adapted in the MODELER, our modeling and forecasting environment:

 

CLICK COMPANY NAME FOR DETAILED STOCK VALUE ANALYSIS

COUNTRY

LAST PRICE

MARKET CAP.

MEAN MULTIPLE UPSIDE [%]

GRAHAM UPSIDE [%]

GREENBLATT UPSIDE [%]

 CIRRUS LOGIC INC

 United States

51.83

3238

-11.8

-22.4

11.0

 INSIGHT ENTERPRISES INC

 United States

32.16

1141

-24.5

25.7

30.4

 IPG PHOTONICS CORP

 United States

83.27

4426

18.0

-7.7

17.6

 LITE-ON TECHNOLOGY CORP

 Taiwan

47.40

110878

1.1

25.9

25.4

 MKS INSTRUMENTS INC

 United States

50.09

2683

-18.9

-31.4

18.1

 SAMSUNG ELECTRONICS CO LTD

 South Korea

1600000.00

226670939

-2.6

37.7

72.1

 SK HYNIX INC

 South Korea

40200.00

29265695

10.0

-36.1

49.9

 SOPRA STERIA GROUP

 France

104.90

2149

-5.9

20.6

10.8

 TERADATA CORP

 United States

30.96

4037

72.7

22.7

24.4