While macroeconomic uncertainties could hinder near-term growth, the long-term prospects of the tech industry remain bright in light of favorable government initiatives and digital transformation across industries. So, quality tech stocks ClearOne, Inc. (CLRO), Nokia Oyj (NOK), and 36Kr Holdings Inc. (KRKR) could be worth watching for value.
The IT revolution has increased operational efficiency and allowed businesses to focus on their strengths. The IT revolution has also created new opportunities for companies to access a worldwide audience and broaden their market reach. The North America IT Services market is anticipated to grow at a 5.8% CAGR to $861.69 billion by 2032.
In addition, the communication platform-as-a-service (Cpaas) market is estimated to reach $130.8 billion by 2032, growing at a 27.5% CAGR. The market is predicted to grow rapidly due to rising mobile phone prevalence, increased acceptance of cloud-based solutions, increased real-time communications use, and global API integration capabilities advancements.
Investors’ interest in tech stocks is evident from the iShares U.S. Technology ETF (IYW) 33.2% returns over the past six months.
In light of these encouraging trends, let’s look at the fundamentals of the three Technology - Communication/Networking stocks, beginning with number 3.
Stock #3: ClearOne, Inc. (CLRO)
CLRO, together with its subsidiaries, designs, develops, and sells conferencing, collaboration, and network streaming solutions for voice and visual communications in the United States and internationally.
CLRO’s trailing-12-month Price/Book of 0.46x is 84.5% lower than the industry average of 2.98x. Its trailing-12-month Price/Sales of 1x is 62.3% lower than the industry average of 2.66x.
CLRO’s trailing-12-month ROCE of 44.21% is significantly higher than the industry average of 0.62%. Its trailing-12-month net income margin of 104.93% is significantly higher than the industry average of 2.01%.
CLRO’s total current liabilities came in at $6.45 billion for the period that ended June 30, 2023, compared to $8.12 billion for the period that ended December 31, 2022. Its total liabilities and stockholders’ equity came in at $8.31 billion, compared to $9.62 billion for the same period.
CLRO’s shares have gained 131% over the past year to close the last trading session at $0.84.
CLRO’s POWR Ratings reflect this promising outlook. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
CLRO has an A grade for Value. Within the Technology - Communication/Networking industry, it is ranked #18 out of 52 stocks. Click here for the additional POWR Ratings for Growth, Quality, Stability, Sentiment, and Momentum for CLRO.
Stock #2: Nokia Oyj (NOK)
Headquartered in Espoo, Finland, NOK provides mobile, fixed, and cloud network solutions globally. The company operates through four segments: Mobile Networks; Network Infrastructure; Cloud and Network Services; and Nokia Technologies. It serves communications service providers, webscales, digital industries, and the government.
On August 3, 2023, NOK became the first telecom company to announce the manufacture of fiber-optic broadband network equipment devices and optical modules in the United States for use in the Broadband Equity, Access, and Deployment (BEAD) program. Nokia collaborated with Sanmina Corporation to manufacture goods at the Sanmina Pleasant Prairie factory in Kenosha County, Wisconsin.
In addition to broadband initiatives, NOK intends to produce optical modules in the United States. Such developments are likely to drive the company’s growth and profitability.
NOK’s forward EV/Sales multiple of 0.77 is 72.5% lower than the industry average of 2.79. Its forward EV/EBIT multiple of 6.43% is 65.2% lower than the industry average of 18.48.
NOK’s trailing-12-month net income margin of 16.43% is 716.9% higher than the 2.01% industry average. Its trailing-12-month ROCE of 20.64% is significantly higher than the 0.62% industry average.
For the second quarter that ended June 30, 2022, NOK’s net sales from the Nokia Technologies segment came in at €334 million ($366.27 million), an increase of 9.5% year-over-year.
Also, its total current liabilities came in at €11.51 billion ($12.51 billion) for the period that ended June 30, 2023, compared to €12.77 billion ($13.89 billion) for the period that ended December 31, 2022. Its total liabilities and stockholders’ equity came in at €40.75 billion ($44.30 billion), compared to €42.94 billion ($46.69 billion) for the same period.
Street expects NOK’s revenue to increase marginally year-over-year to $26.67 billion for the year ending December 2024. Its EPS is expected to grow 11.8% year-over-year to $0.47 for the same period. Over the past month, the stock has gained 1.3% to close the last trading session at $3.98.
NOK is ranked #16 in the same industry. It has an A grade for Value. To see additional NOK’s ratings for Growth, Stability, Momentum, Sentiment and Quality, click here.
Stock #1: 36Kr Holdings Inc. (KRKR)
Headquartered in Beijing, the People’s Republic of China, KRKR provides content and business services in the People’s Republic of China. It creates and distributes various content, including insightful reports on companies and timely market updates, as well as editorials and commentaries in various industries, such as technology, media and entertainment, consumer, retail, and healthcare.
KRKR’s forward EV/Sales multiple of 0.35 is 80.7% lower than the industry average of 1.82. Its forward Price/Sales multiple of 0.67% is 44% lower than the industry average of 1.20.
KRKR’s trailing-12-month gross profit margin of 55.43% is 12.3% higher than the 49.37% industry average. Its trailing-12-month asset turnover ratio of 0.66x is 35.5% higher than the 0.48x industry average.
KRKR’s total revenues increased by 3.1% to RMB84.36 million ($11.63 million) in the fiscal second quarter that ended June 30, 2023. Its subscription services revenue came in at RMB10.60 million ($1.46 million), up 10.2% year-over-year. Also, its gross profit came in at RMB46.72 million ($6.44 million).
Analysts expect KRKR’s revenue to increase 4.9% year-over-year to $49.14 million for the year ending December 2023. Its EPS is expected to come in at $0.06 for the same period. KRKR’s stock has lost 2.7% intraday to close the last trading session at $0.82.
KRKR has an A grade for Growth and a B grade for Sentiment and Value. It is ranked #13 in the same industry.
Beyond what is stated above, we’ve also rated KRKR for Momentum, Stability and Quality. Get all KRKR ratings here.
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NOK shares were trading at $3.99 per share on Thursday morning, up $0.01 (+0.25%). Year-to-date, NOK has declined -12.82%, versus a 19.15% rise in the benchmark S&P 500 index during the same period.
About the Author: Rashmi Kumari
Rashmi is passionate about capital markets, wealth management, and financial regulatory issues, which led her to pursue a career as an investment analyst. With a master's degree in commerce, she aspires to make complex financial matters understandable for individual investors and help them make appropriate investment decisions.
3 Tech Stocks Showing Value End of August StockNews.com
