3 Market-Beating Tech Stocks Investors Should Own Beyond Nvidia

  • Stock Market Analysis
  • Editor's Pick
  • While Nvidia remains a favorite, several tech stocks offer compelling investment opportunities amid the current rally.
  • Investors looking to diversify their portfolios with high-potential tech stocks should consider the ones discussed in the article.
  • Each company is well-positioned to capitalize on industry trends and technological advancements, particularly in AI, making them attractive choices.
  • Looking for actionable trade ideas to navigate the current market volatility? Unlock access to InvestingPro’s AI-selected stock winners for just 60 cents a day!

As the tech sector continues to experience a significant rally, with the Nasdaq reaching a series of new highs in recent sessions, investors are on the lookout for promising stocks beyond the usual favorites like Nvidia (NASDAQ: NVDA ).

Nasdaq Chart

Source: Investing.com

Using the power of InvestingPro, I identified three market-beating tech stocks that stand out as solid investment options in the rapidly evolving digital landscape: ServiceNow (NYSE: NOW ), Applied Materials (NASDAQ: AMAT ), and Nutanix (NASDAQ: NTNX ).

Each of these companies boasts unique strengths, innovative use of AI, and growth opportunities, making them attractive choices in the current market environment.

Furthermore, all three stocks have outperformed the broader market in the past 12 months thanks to robust demand for their innovative products and services, and they each have an excellent InvestingPro 'Company Financial Health Score'.

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Now, let's delve deeper into why these three stocks could be great options to consider investing in.

1. ServiceNow

ServiceNow provides cloud-based solutions for enterprise IT operations, focusing on digital workflows and IT service management. The company's innovative platform enables businesses to automate routine tasks, streamline processes, and enhance productivity.

Over the years, ServiceNow has expanded its offerings to include HR, customer service, and security operations, making it a versatile tool for enterprises.

Year-to-Date Performance:

ServiceNow stock has surged 52% over the past 12 months, significantly outperforming the Nasdaq 100’s 35% gain over the same period.ServiceNow Stock Performance

Source: InvestingPro

NOW ended Tuesday’s session at $776.68, about 5% below its record closing high of $812.94 reached on February 9. At current levels, the Santa Clara, California-based company has a market cap of $159.5 billion.

Investment Case:

ServiceNow's strong growth trajectory is driven by the increasing adoption of digital transformation initiatives across industries. The company's excellent InvestingPro 'Company Financial Health Score' highlights the strength of its underlying business and strong growth prospects.

ServiceNow Financial Health

Source: InvestingPro

With a solid customer base and high renewal rates, ServiceNow is well-positioned to capitalize on the ongoing shift to cloud-based solutions. In addition, the enterprise software maker has consistently reported impressive financial results, reflecting its robust business model and strong market demand.

Revenue and Profits

Source: InvestingPro

It should be noted that ServiceNow is leveraging AI to enhance its product offerings and create new revenue streams. The company's AI-powered Now Platform includes predictive analytics, machine learning, and natural language processing capabilities that help businesses automate complex workflows and improve decision-making processes.

This strategic use of AI not only differentiates ServiceNow from its competitors but also drives higher adoption rates and customer satisfaction.

Bottom Line:

All things considered, ServiceNow’s ability to continuously innovate and expand its platform’s capabilities makes it a leader in the enterprise software space.

2. Applied Materials

Applied Materials is a key supplier of equipment, services, and software to the semiconductor industry. The company’s technologies are essential for manufacturing chips used in various electronic devices, including smartphones, computers, televisions, and advanced servers.

The chip gear vendor’s expertise spans across semiconductor, display, and related industries, making it a critical player in the tech supply chain.

Year-to-Date Performance:

Shares of Applied Materials have climbed 73.1% during the past year, easily outpacing the broader market.

Applied Materials Stock Performance

Source: InvestingPro

AMAT stock closed at $219.80 last night, a whisker below its all-time high, earning the semiconductor equipment maker a valuation of $182.6 billion.

Investment Case:

Applied Materials’ outstanding InvestingPro 'Company Financial Health Score' highlights its solid financial foundation and high growth potential amid the current business environment.

Applied Materials Financial Health

Source: InvestingPro

As demand for semiconductors continues to surge, Applied Materials is set to benefit from increased capital expenditures by chip manufacturers. Additionally, the chip equipment supplier’s strong relationships with leading semiconductor manufacturers provide a stable revenue base and growth opportunities.

Revenue and Profits

Source: InvestingPro

Furthermore, Applied Materials is at the forefront of integrating AI into its manufacturing processes to optimize semiconductor production, enhance yield rates, and reduce production costs. These AI innovations not only boost the company’s operational performance but also provide significant value to its customers, further strengthening its prominent market position.

Bottom Line:

With robust financial health and an ongoing commitment to innovation, Applied Materials is a solid bet for investors looking to capitalize on the semiconductor boom.

3. Nutanix

Nutanix specializes in hyper-converged infrastructure (HCI) solutions, which simplify data center management by integrating compute, storage, and networking into a single platform. The company’s software-defined solutions enable businesses to build and manage private, hybrid, and multi-cloud environments efficiently.

The cloud computing company’s offerings are designed to reduce complexity, increase agility, and lower costs for enterprises.

Year-to-Date Performance:

Nutanix has soared by 186% over the last 12 months, far exceeding the broader market's performance and making it one of the top-performing stocks in the tech-heavy Nasdaq Composite.Nutanix Stock Performance

Source: InvestingPro

NTNX stock ended at $73.37 last night, its highest-ever closing price, giving it a market cap of roughly $18 billion.

Investment Case:

Nutanix has demonstrated impressive financial performance, with steady revenue growth and an expanding customer base, signaling a strong market position and future potential. Indeed, as can be seen below, the company's solid InvestingPro 'Company Financial Health Score' reflects its strong business fundamentals and promising growth outlook.

Nutanix Financial Health

Source: InvestingPro

Nutanix is well-positioned to benefit from the growing trend towards cloud computing and data center modernization. As more businesses transition to hybrid and multi-cloud strategies, the enterprise cloud company’s solutions are in high demand, driving its growth prospects.

Revenue and Profits

Source: InvestingPro

Additionally, it is worth mentioning that Nutanix leverages AI-driven capabilities to enhance its HCI solutions deliver smarter infrastructure management, and optimize application performance across hybrid cloud environments.

This strategic focus on AI not only enhances Nutanix’s product offerings but also creates new opportunities for revenue growth and customer engagement.

Bottom Line

Overall, Nutanix’s strong partnerships with major cloud providers and its continuous innovation in HCI technology make it a leader in its field.

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Disclosure: At the time of writing, I am long on the S&P 500, and the Nasdaq 100 via the SPDR S&P 500 ETF (SPY (NYSE: SPY )), and the Invesco QQQ Trust ETF (QQQ).

I regularly rebalance my portfolio of individual stocks and ETFs based on ongoing risk assessment of both the macroeconomic environment and companies' financials. The views discussed in this article are solely the opinion of the author and should not be taken as investment advice.

Follow Jesse Cohen on X/Twitter @JesseCohenInv for more stock market analysis and insight.

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