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My wife says that at the rate I'm going, we're going to have to buy a new table.
Let me explain. My job as your tech analyst is to go beyond the headlines and find great tech stocks that can absolutely crush the market – in good times and in bad.
And that often means pounding the table for the global tech ecosystem in general, and for market rippers in particular.
That's exactly what I did back on Jan. 11. You may not recall it, but in my mind's eye, it's as if it were just yesterday.
At the time, the tech-centric Nasdaq had entered bear market territory, defined as a 20% drop from a recent high. I said it was "fear and not fundamentals" that was driving the market lower.
I then listed three beaten-down tech leaders I said were poised for big rebounds.
Today, I'm following up to let you know – all three just crushed it, as I'll show you. And I'll also show you why there's still plenty of upside ahead…
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With apologies to Yogi Berra, it's like deja vu all over again.
During that Jan. 11 chat, I noted the Nasdaq was far from alone in the sell-off. Stocks were broadly and brutally battered with the S&P 500 off 19%.
We're in a similar situation today. Stocks are getting broadly battered on fears about rising trade tensions with China, after President Trump said he'd put tariffs on $300 billion of additional Chinese goods.
But now as then, I pointed out that the economy was in overall great shape, as evidenced by the best jobs market in nearly 50 years.
So, I have no doubt about my mantra – the road to wealth is paved with tech. Here is what I said at the time:
"I believe that tech will once again lead the market higher as it has done since the bull market began nearly 10 years ago. And that means we will have plenty of chances to make money on tech shares in the year ahead."
And to make sure you had actionable intelligence, I listed three beaten-down tech leaders poised for a massive rebound. I'm happy to report that all three have had a great year.
Now then, to be consistent, I'm going to mark their rallies from Dec. 24, when the market rebounded. I've been using that date all year, and I think it's important to remain consistent. Take a look at these three market crushers.
Oversold Tech Leader, No. 1: Adobe Inc. (NASDAQ: ADBE)
Even in the best of bull markets, a gain of 36.6% in just over seven months is nothing to sneeze at. That means Adobe beat the broad market by 72.6% in the period.
Then again, Adobe said on June 18 that it had achieved record quarterly revenue of $2.74 billion for its fiscal second quarter that ended May 31. Those sales were up 25% from the year-ago quarter.
With earnings of $1.83 a share, it beat forecasts. It also offered an upbeat report for the rest of the year. Following that bullish report, no fewer than 11 analysts upgraded the stock.
I have to say that I'm not surprised at how well this software leader is really doing. I've recommended this stock several times since the summer of 2013.
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I've done so because the company has done a great job of moving from standard software sales to recurring revenue through a cloud-delivery format.
It now offers a suite of products through its Creative Cloud platform that is nothing short of a cash machine. It has profit margins of 39% and a 38% return on equity.
The firm also has a crackerjack CEO. Barrons named Shantanu Narayen one of the world's best CEOs in 2016 and 2017. I'm projecting 35% gains over the next three years.
Oversold Tech Leader, No. 2: Square Inc. (NYSE: SQ)
Square once again defied the skeptics with a return of 27.9% since Dec. 24. That was enough to beat the broader market by 31.6%.
Irony abounds. This is one of those stocks where Wall Street periodically hits the panic button – giving savvy tech investors new entry points at a discount from its long-term upside.
That happened again on Aug. 2, when the Street freaked out over the fintech leader's second quarter financials. It beat on sales and earnings, but the stock got hammered.
Turns out Square guided a little lighter for the third quarter than what analysts had forecast. But their loss is your gain.
Square is making a series of bold moves to improve growth and strengthen earnings, moves that will bolster the stock over the long run.
For instance, the firm is selling its Caviar food-delivery unit for $400 million. That means it is exiting a tough business with low margins to invest in products that make it a stronger fintech leader.
Now, it has plenty of money to invest in online shopping business and its CashApp, which competes with Venmo, a unit of PayPal Holdings Inc. (NASDAQ: PYPL).
In other words, CEO and founder Jack Dorsey just keeps on defying the skeptics. He's become the king of upsell by adding new products and features that improves service for clients and earnings for the firm. I'm projecting 3-year gains of 50%.
Oversold Tech Leader, No. 3: HealthEquity Inc. (NASDAQ: HQY)
About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.