While most technology investors are pretty giddy these days as they celebrate their returns over the past couple of years, as most investors know, good fortune doesn’t smile on everybody. However, taking a contrarian stance when a company is down can be among the best trades ever. If you don’t think that is the case just ask people who bought Amazon.com Inc. (NASDAQ: AMZN) as low as $35 in 2008 or Google, now part of Alphabet Inc. (NASDAQ: GOOGL), in 2004 at $85.
We screened our 24/7 Wall St. research database looking for technology value and found four incredible companies that have been absolutely hammered this year that may be offering investors incredible upside potential. These are not penny stocks or ones with some sort of kryptonite that could keep them forever shunned. They are solid companies that in some cases are among the leaders in their specific tech arenas.
While we acknowledge these are only suitable for very aggressive, risk-tolerant accounts that also may need to be bestowed with patience, it may make sense for savvy investors to take a long hard look.
This stock was hit hard earlier this year due to very disappointing guidance for the second quarter, and then again when the company delivered bad second-quarter results. Akamai Technologies Inc. (NASDAQ: AKAM) provides cloud services for delivering, optimizing and securing content and business applications over the internet in the United States and internationally.
The company offers performance and security solutions designed to help websites and business applications operate while offering protection against security threats. It also provides media content delivery solutions that are designed to deliver movies, television shows, live events, games, social media, software downloads and other content on the internet in fixed-line and mobile networks; adaptive delivery solutions for streaming video content; and download delivery solution that offers accelerated distribution for large file downloads, including games, progressive media files, documents and other file-based content.
The shares of Akamai are down a stunning 30% this year, and rumors still continue to swirl around the company as a potential takeover target.
MKM Partners has a Buy rating on the shares and a $58 target price. The Wall Street consensus price target for the company is $57.23, and the shares closed Tuesday’s trading at $47.83 apiece.
This is another technology giant that has been absolutely mauled. F5 Networks Inc. (NASDAQ: FFIV) is a provider of application delivery networking products that manage, control and optimize internet traffic within a network. The company’s products include Server Load Balancer, Secure Socket Layer (SSL), Virtual Private Network (VPN), WAN optimization, Network Attached Storage, DDoS and diameter signal routing.
The company reported fiscal third-quarter results that were generally in line with the consensus forecast, but it offered up fourth-quarter revenues and earnings per share guidance that were below lofty Wall Street expectations. While much of the weakness was attributed to Asian and Japanese markets, some analysts also cited purchase delays due to the public cloud, as well as new architectures.
While market pressures remain, the current valuation, the company’s cash position and new management are all positives that bode well for the future.
D.A. Davidson has the stock rated Buy with a massive $156 price target. The consensus price objective for the shares is $132.76. The stock closed trading on Tuesday at $118.61 a share.