If one area has pushed the S&P 500 higher this year it’s the technology sector, and many investors may be wondering at this juncture if the ride is all but over. While some of the top companies in the arena are starting to look a little tired, others have either blasted out incredible earnings, or may be just at the beginning of what could be a substantial move higher.
Jefferies is out with the firm’s top growth stock calls of the week, and technology and a very hot gaming stock make the list. Investors looking for new alpha-generating ideas may want to consider these top picks. All are rated Buy, but they are for more risk-tolerant accounts as they can be subject to larger price swings.
This leading video game developer should benefit from not only the continuing rise in new console sales, but also the rising trend of mobile gaming. Electronic Arts Inc. (NASDAQ: EA) produces top-selling games and related content and services under the EA brand in various categories, including action-adventure, role-playing, racing and first-person shooter games.
The company, which is very well known for its EA sports games like Madden Football, has made the move into mobile play by adapting many of the top franchise titles, which have been popular for years, into the mobile arena.
The company posted solid quarterly numbers last week, and the analyst noted this in the report:
Company reported last week. Revenues were in line but earnings-per-share beat and that underscores the importance of in-game spending and its impact on profitability. For fiscal 2017, full game downloads accounted for 33% of unit sales, up from 24% last year. We raised fiscal 2018 EPS to $4.19 from $4.10, which is roughly in line with the Street.
The Jefferies price target for the shares is $123, and the Wall Street consensus price objective is $111.02. The stock closed at $110.90 a share on Monday.
This stock was hit hard back in March and may be offering a very good entry point for investors. Finisar Corp. (NASDAQ: FNSR) provides optical subsystems and components for data communication and telecommunication applications in the United States, Malaysia, China and internationally.
Its optical subsystems primarily consist of transmitters, receivers, transceivers, transponders and active optical cables that provide the fundamental optical-electrical or optoelectronic interface for interconnecting the electronic equipment used in communication networks, including the switches, routers and servers used in wireline networks, as well as the antennas and base stations used in wireless networks.
The company also offers wavelength selective switches, which are used to switch network traffic from one optical fiber to multiple other fibers without converting to an electronic signal. In addition, it provides optical components comprising packaged lasers, receivers and photodetectors for data communication and telecommunication applications, as well as passive optical components for telecommunication applications.
Jefferies has a $34 price target on the shares, but the posted consensus target is up at $38.11. The stock closed most recently at $24.80.