The technology sector has significantly outperformed the rest of the market over the past year thanks to pandemic-driven changes in consumer and business behavior. The need to stay operational while distancing from others to avoid contact with the virus has led to an increased reliance on business and communications technology.
The sector’s solid performance is evident in the iShares U.S. Technology ETF’s (IYW) 44.3% returns over the past year. This compares to the SPDR S&P 500 ETF Trust’s (SPY) 15.7% gains over the same timeframe. Emerging technologies such as 5G, cloud computing, and artificial intelligence (AI) should keep driving the sector’s performance in the coming years.
Roku, Inc. (ROKU – Get Rating), Applied Materials, Inc. (AMAT – Get Rating), and Cirrus Logic, Inc. (CRUS – Get Rating) are innovating quickly to drive future growth. These companies saw significant stock price gains over the past year, and we think will continue soaring this year and beyond.
ROKU’s primary offering is a streaming entertainment device that can be connected to televisions. The company also offers software development kits for their device. ROKU’s stock has gained 220% over the past year.
ROKU recently launched the Roku Streambar in the U.K. It has also launched the Roku Channel in the U.K. The company recently announced that it crossed 50million-plus active accounts in 2020.
For the quarter ended September 30, 2020, ROKU saw a rise in revenue of 73% year-over-year. The company’s gross profit grew 81% during the same period.
ROKU is expected to see 44.4% revenue growth for the quarter ended March 31, 2021 and 39.4% in 2021. Its EPS is estimated to grow 40.5% in 2021.
How does ROKU stack up for the POWR Ratings?
A for Trade Grade
B for Buy & Hold Grade
A for Industry Rank
B for Overall POWR Rating
The stock is also ranked #20 of 54 stocks in the Technology – Hardware industry.
AMAT is involved in providing materials engineering solutions for application in the semiconductor, solar photovoltaic, and flat panel display sectors. AMAT’s stock has returned 65.1% over the past year.
The company recently forged a collaboration with BE Semiconductor Industries to make the world’s first equipment solution for die-based hybrid bonding. It also announced a quarterly cash dividend of $0.22 per share.
For the quarter ended October 2020, AMAT saw a 25% increase in net sales versus the same period last year. The company’s operating margin increased 4.4 percentage points over the same period.
AMAT’s revenue is estimated to…
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