This week the action starts to heat up in the technology sector, with some of the big boys stepping up to the plate to present numbers for the first quarter. A new research note from UBS also mentions the fact that on Friday the first Apple Watch shipment numbers will come out.
While the UBS team says some out-of-favor stocks like International Business Machine Corp. (NYSE: IBM) may appeal to contrarian investors, they are sticking with market leaders that could be poised to report good earnings, or at the minimum not throw out a huge downside surprise. Here are the top IT tech hardware stocks to buy now at UBS: Akamai Technologies Inc. (NASDAQ: AKAM), Apple Inc. (NASDAQ: AAPL), EMC Corp. (NYSE: EMC), Hewlett-Packard Co. (NYSE: HPQ) and Nimble Storage Inc. (NASDAQ: NMBL).
Akamai Technologies is one of the leading providers of cloud services for delivering, optimizing and securing online content and business applications. About half of Akamai’s revenues are from media delivery (delivery of content) over the Internet using the company’s 135,000 server global edge network and software, for which demand is driven by video delivery and software downloads. Akamai is the leading provider of website optimization and acceleration services to e-commerce companies, a key reason for making the UBS list.
The UBS price target for the stock is $80. The Thomson/First Call consensus price target is set at $73.89. The stock ended Friday’s trading session at $71.90 a share. Akamai reports earnings on April 28.
Apple remains the world’s biggest and boldest technology company, and it has stayed in the limelight with the release of the new Apple Watch. As the UBS team pointed out, the first data on shipments will be out this Friday. While not generating the kind of in-store mania the iPhone 6 release did, reports indicate over a million orders for the new wearable device were taken by the company.
Many Wall Street analysts say investors need to stay long the stock into first-quarter earnings and through the second quarter. They see strong continued iPhone 6 and 6 Plus sales, as well as numerous catalysts on the horizon. The company is also widening its lead over Google in the app marketplace. In fact, revenue at Apple’s global App Store was about 70% higher than on Google Play in the first quarter, compared with about a 60% advantage in the third quarter of 2014.
Apple investors are paid a 1.5% dividend. The UBS price target is $142. The consensus target is at $139.95. The stock closed Friday at $124.75. Apple reports earnings on April 27.
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