Incurring stains of red ink is never fun in the equities arena. At the same time, the fallout may present a viable long-term opportunity at a discount, especially for promising tech stocks. So long as the company and associated sector fundamentals are solid, market volatility presents a chance to acquire a good business that merely encountered temporary setbacks.
Further, until evidence comes out to the contrary, investors have good reason to bet on emerging trends. Take artificial intelligence as a key example. According to Grand View Research, the global AI market size reached a valuation of $196.63 billion in 2023. By 2030, the ecosystem could expand to over $1.81 trillion, representing a compound annual growth rate of 36.6%.
Betting on compelling but deflated tech stocks — though it may initially seem hazardous — could turn out to be a prudent maneuver. The winds of innovation are pushing for greater autonomy, intelligence and ultimately productivity, not less. With that, below are three discounted tech firms that are well worth putting on your radar.
For the first half of 2024, Micron Technology (MU) was on a tear. As a producer of advanced memory and storage solutions such as DRAM and NAND, Micron manufactures the system components that are critical for AI workloads. As machine intelligence consumes more immense computational power, demand for Micron’s high-performance memory chips should rise.
However, the company didn’t quite deliver all the goods in its last earnings report. Specifically, one of the concerns stemmed from gross margin pressure due to NAND market conditions and underload charges. Further, Micron’s consumer segment showed weakness, a consequence of delays in the PC refresh cycle and overall pensiveness in demand.
After an initial bout of weakness, MU represents one of the tech stocks on the move. In the business week ending Jan. 17, shares gained over 10%. It wouldn’t be surprising to see the positive momentum sustain itself. Analysts are projecting consensus revenue of $34.97 billion for fiscal 2025 and $44.62 billion in fiscal 2026.
At the moment, MU stock trades for only 3.96X sales. Roughly half-a-year ago, this metric stood at 7.5X. It would seem, then, that Micron ranks among the tech stocks at an attractive discount.
Moving a bit over into the speculative side of the spectrum, Wolfspeed (WOLF) specializes in silicon carbide (SiC) and gallium nitride (GaN) semiconductors, which are used in high-power, high-efficiency applications. Perhaps most notably, Wolfspeed’s specialty is particularly pertinent for electric vehicles. Given the wider push for advanced and clean mobility, WOLF represents one of the more intriguing tech stocks to consider.
However, the company’s utility doesn’t just revolve around EVs. From industrial automation to 5G networks, Wolfspeed’s semiconductors enable these vast, diverse systems to benefit from faster and more efficient data transfers and energy consumption. With the integration of AI into these sectors, WOLF may see residual tech tailwinds.
Now, what makes the entity so alluring is the same reason why it’s so treacherous. Over the past 52 weeks, WOLF dropped slightly over 80% of equity value. This stat line easily makes it one of the worst-performing tech stocks.
Still, it comes down to belief in the forward narrative. For fiscal 2026, analysts are projecting consensus revenue of $1.15 billion, with the high-side estimate standing at $1.67 billion. Currently, WOLF trades at 1.06X sales, which is at a discount relative to its multiple of 5.83X back in December 2023.
Perhaps the most exciting name among the tech stocks on this list, Quantum Computing (QUBT) is also wildly risky. Focused on providing the namesake solution, Quantum commands the potential to revolutionize AI by solving optimization problems and processing data at an exponentially quicker clip than classical computers.
Although the sector is in the early stages, the underlying innovation is promising. With quantum computers, engineers can significantly enhance AI’s ability to process large datasets, as well as train new models and optimize algorithms. Presently, Quantum is exploring how these advanced computers can be applied to contemporary AI challenges.
Over time, quantum computing may see powerful utility in diverse fields that require robust data analyses, such as drug discovery, logistics optimization and complex simulations. It’s no wonder, then, that over the past 52 weeks, QUBT stock gained almost 1,129%.
However, in the past month, QUBT lost over 41%, drawing discount hunters to the campgrounds. To be fair, analysts are only projecting fiscal 2025 sales to land at $1.5 million. Not surprisingly, then, the revenue multiple is astronomically high. Still, the prospect of grabbing the next Nvidia (NVDA) may be too enticing for some speculators to ignore.
