Stocks to Watch: A Tech Trio
07/14/2016 8:00 am EST
While uncertainties abound, the market’s action makes us optimistic, our market timing indicators are leaning bullish, and we think the next big move is up, asserts growth stock expert Mike Cintolo, editor of Cabot Growth Investor.
Meanwhile, the stocks below are not yet official recommendations; however, we consider these to be "stocks of interest" to present you with additional ideas.
Acacia Communications (ACIA)
Acacia’s product line is exclusively-focused on devices that converts digital signals from network equipment to optical (for transmission over a fiber network.
Acacia addresses the big, long-haul networks, metro networks and lines between data centers, all of which benefit from its faster throughput and automatic operation.
The company is young (founded in 2009) and the stock is even younger (IPO in May 2016), but earnings growth has been very strong (EPS more than doubled between 2014 and 2015) and estimates are for a 77% jump in 2016.
The company’s narrow focus is a concern, but if it can keep ahead of the competition, this could be a winner.
Mobileye is a player in the race to create a self-driving car. Its technologies are already in use in crash-avoidance sensors and other semi-autonomous features.
Revenue and earnings growth has been great (88% earnings growth in the latest quarter on 65% revenue growth), but the fortunes of MBLY likely depend on the horse-race.
There’s lots of competition in this race, but Mobileye is clearly among the leaders. This is a company to keep an eye on.
Nevro is another company with a unique technology and huge potential. Nevro’s HF10 technology uses high frequency stimulation signals delivered near the spinal cord to disrupt pain signals.
Spinal cord stimulation itself is a well-tested way to treat chronic pain, but Nevro’s proprietary HF10 system gives more relief with fewer side effects.
The firm isn’t profitable, and no profits are predicted at least through 2017, but sales growth is rapid and the market for treating chronic leg and back pain exceeds $1.5 billion, so the potential is high. We think it’s an interesting speculation.
By Mike Cintolo, Editor of Cabot Growth Investor