Investors may be concerned about rising tensions in the trade war between the U.S. and China that’s caused some recent volatility in the stock market, but that doesn’t mean that there still aren’t great companies out there that are worth snatching up right now. The technology sector, in particular, has plenty of fantastic companies that investors can buy now and hold onto for the long haul.
We reached out to three Motley Fool contributors for their thoughts on three of the best tech stocks to buy this month. They mentioned Universal Display (NASDAQ:OLED), Skyworks Solutions (NASDAQ:SWKS), and Microsoft (NASDAQ:MSFT). Here’s why.
The future is bright for Universal Display
Steve Symington (Universal Display): I know Universal Display stock only just popped 12% after the organic light-emitting diode (OLED) technologist crushed expectations and raised its full-year guidance with its first-quarter report earlier this month. But the stock has also given back some of those gains in the days since, and I think there’s reason to believe it has much, much higher to go from here.
One reason is that management cited “strong momentum in the [OLED] industry” for the company’s relative outperformance. Original equipment manufacturers (OEMs) continue to spend tens of billions of dollars not only to create novel, innovative new display form factors centering around OLED — most recently including devices with foldable displays as seen in Samsung’s Galaxy Fold — but also to build out their respective OLED manufacturing capabilities. And that’s not to mention the fact that the potentially massive OLED lighting industry is still in its infancy. What we’re seeing right now reflected in Universal Display’s boosted 2019 outlook are only the first fruits of a much longer-term trend supporting the company’s growth.
What’s more, last week, Universal Display set the groundwork to expand its reach even further with the launch of UDCVentures, a new corporate venture arm with a stated goal to “invest in and partner with entrepreneurs, disruptive start-ups and innovative, emerging companies with an emphasis on technology platforms that have a strong proprietary position and significant growth potential.” And of course, UDCVentures will leverage Universal Display’s strengths, focusing on sectors ranging from OLED to lighting, displays, materials sciences, and other organic electronics.
Universal Display has cash, cash equivalents, and short-term investments of more than $525 million on its balance sheet and nominal debt. I think this a fantastic way for the company to explore putting its excess resources to work.
Buy Skyworks when smartphones are suffering
Anders Bylund (Skyworks Solutions): Times are tough in the pipeline for smartphone components. Skyworks, which makes chips used in a variety of wireless communications technologies, certainly feels some pain when mighty Apple can’t keep its iPhone shipping volumes high and rising. Hence, Apple supplier Skyworks has seen its share prices slide 11% lower since Cupertino reported earnings at the end of April.
Sounds like bad news, but the company has a few tricks up its sleeve. For one, Skyworks has….
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