20 Highly Profitable Tech Companies for Your Watchlist

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 |  Includes: ADI, ALTR, AMT, APKT, CSCO, CTL, DLB, FFIV, GLW, IGT, IHS, INTC, JNPR, LLTC, MCHP, NATI, NSM, QCOM, WDC, XLNX
by: Kapitall

If you're looking for ideas in the tech sector, this list might offer a good starting point.

The following is a list of tech stocks that have been more profitable than their competitors over the last 12 months, when comparing gross margin, EBITDA, and pretax margin.

Will these companies continue to be more profitable than their industry competitors? Perhaps more importantly, considering their track record of profitability, is most of the good news already priced into these stock prices?

We're not going to go into detailed analysis for each company. The goal here is to offer an interesting starting point for your own analysis.

Profitability data and industry comps sourced from Fidelity, short float and performance data sourced from Finviz.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research. Note: The numbers on top of items represent the forward P/E ratio, if available.



List sorted by difference between gross margin and industry average.

1. Dolby Laboratories Inc. (NYSE:DLB): Diversified Electronics Industry. Market cap of $5.77B. TTM Gross Margin at 91.64% vs. industry average at 36.70%. TTM EBITDA Margin at 51.72% vs. industry average at 15.77%. TTM Pretax Margin at 46.78% vs. industry average at 13.12%. Short float at 4.39%, which implies a short ratio of 3.88 days. The stock has lost 3.00% over the last year.

2. National Instruments Corporation (NASDAQ:NATI): Technical & System Software Industry. Market cap of $3.78B. TTM Gross Margin at 81.42% vs. industry average at 36.70%. TTM EBITDA Margin at 18.91% vs. industry average at 15.77%. TTM Pretax Margin at 14.67% vs. industry average at 13.12%. Short float at 1.33%, which implies a short ratio of 3 days. The stock has gained 55.45% over the last year.

3. International Game Technology (NYSE:IGT):
Diversified Computer Systems Industry. Market cap of $5.12B. TTM Gross Margin at 64.86% vs. industry average at 35.62%. TTM EBITDA Margin at 36.77% vs. industry average at 19.84%. TTM Pretax Margin at 15.72% vs. industry average at 14.19%. Short float at 6.6%, which implies a short ratio of 4.94 days. The stock has lost 4.36% over the last year.

4. Acme Packet, Inc. (NASDAQ:APKT): Communication Equipment Industry. Market cap of $4.64B. TTM Gross Margin at 85.67% vs. industry average at 58.93%. TTM EBITDA Margin at 32.18% vs. industry average at 22.60%. TTM Pretax Margin at 28.78% vs. industry average at 18.06%. Short float at 5.51%, which implies a short ratio of 1.41 days. The stock has gained 381.30% over the last year.

5. F5 Networks, Inc. (NASDAQ:FFIV): Application Software Industry. Market cap of $10.20B. TTM Gross Margin at 83.46% vs. industry average at 58.30%. TTM EBITDA Margin at 30.14% vs. industry average at 22.13%. TTM Pretax Margin at 28.61% vs. industry average at 17.63%. Short float at 5.35%, which implies a short ratio of 1.24 days. The stock has gained 135.02% over the last year.

6. Linear Technology Corp. (NASDAQ:LLTC):
Semiconductor Industry. Market cap of $7.97B. TTM Gross Margin at 81.53% vs. industry average at 57.94%. TTM EBITDA Margin at 55.57% vs. industry average at 33.58%. TTM Pretax Margin at 47.22% vs. industry average at 23.60%. Short float at 5.38%, which implies a short ratio of 5.25 days. The stock has gained 30.65% over the last year.

7. Corning Inc. (NYSE:GLW):
Communication Equipment Industry. Market cap of $34.21B. TTM Gross Margin at 58.73% vs. industry average at 36.70%. TTM EBITDA Margin at 35.07% vs. industry average at 15.77%. TTM Pretax Margin at 57.95% vs. industry average at 13.12%. Short float at 1.61%, which implies a short ratio of 1.8 days. The stock has gained 22.75% over the last year.

8. Intel Corporation (NASDAQ:INTC): Semiconductor Industry. Market cap of $119.65B. TTM Gross Margin at 76.65% vs. industry average at 57.94%. TTM EBITDA Margin at 47.11% vs. industry average at 33.58%. TTM Pretax Margin at 37.52% vs. industry average at 23.60%. Short float at 0.96%, which implies a short ratio of 1.01 days. The stock has gained 7.09% over the last year.

9. CenturyLink, Inc. (NYSE:CTL): Telecom Services Industry. Market cap of $13.29B. TTM Gross Margin at 66.67% vs. industry average at 49.93%. TTM EBITDA Margin at 51.70% vs. industry average at 33.80%. TTM Pretax Margin at 21.22% vs. industry average at 14.90%. Short float at 9.16%, which implies a short ratio of 6.91 days. The stock has gained 35.15% over the last year.

10. National Semiconductor Corporation (NSM): Semiconductor Industry. Market cap of $3.68B. TTM Gross Margin at 74.56% vs. industry average at 57.94%. TTM EBITDA Margin at 37.30% vs. industry average at 33.58%. TTM Pretax Margin at 26.14% vs. industry average at 23.60%. Short float at 5.09%, which implies a short ratio of 2.91 days. The stock has gained 8.61% over the last year.

11. Qualcomm Incorporated (NASDAQ:QCOM): Communication Equipment Industry. Market cap of $96.39B. TTM Gross Margin at 73.59% vs. industry average at 58.93%. TTM EBITDA Margin at 36.76% vs. industry average at 22.60%. TTM Pretax Margin at 36.94% vs. industry average at 18.06%. Short float at 1.86%, which implies a short ratio of 2.09 days. The stock has gained 51.52% over the last year.

12. Altera Corp. (NASDAQ:ALTR): Semiconductor Industry. Market cap of $12.83B. TTM Gross Margin at 72.40% vs. industry average at 57.91%. TTM EBITDA Margin at 45.49% vs. industry average at 33.64%. TTM Pretax Margin at 44.40% vs. industry average at 23.46%. Short float at 5.4%, which implies a short ratio of 2.82 days. The stock has gained 76.44% over the last year.

13. American Tower Corp. (NYSE:AMT):
Diversified Communication Services Industry. Market cap of $22.27B. TTM Gross Margin at 74.85% vs. industry average at 61.21%. TTM EBITDA Margin at 63.68% vs. industry average at 38.91%. TTM Pretax Margin at 27.90% vs. industry average at 15.45%. Short float at 0.94%, which implies a short ratio of 1.46 days. The stock has gained 27.68% over the last year.

14. IHS Inc. (NYSE:IHS): Business Software & Services Industry. Market cap of $5.34B. TTM Gross Margin at 56.98% vs. industry average at 43.97%. TTM EBITDA Margin at 23.69% vs. industry average at 18.49%. TTM Pretax Margin at 17.24% vs. industry average at 10.51%. Short float at 2.51%, which implies a short ratio of 5.51 days. The stock has gained 59.92% over the last year.

15. Juniper Networks, Inc. (NYSE:JNPR):
Networking & Communication Devices Industry. Market cap of $23.22B. TTM Gross Margin at 70.67% vs. industry average at 58.93%. TTM EBITDA Margin at 22.97% vs. industry average at 22.60%. TTM Pretax Margin at 19.01% vs. industry average at 18.06%. Short float at 2.47%, which implies a short ratio of 2.19 days. The stock has gained 73.26% over the last year.

16. Analog Devices Inc. (NASDAQ:ADI): Semiconductor Industry. Market cap of $12.29B. TTM Gross Margin at 69.54% vs. industry average at 57.95%. TTM EBITDA Margin at 37.57% vs. industry average at 33.64%. TTM Pretax Margin at 32.65% vs. industry average at 23.48%. Short float at 3.04%, which implies a short ratio of 2.73 days. The stock has gained 48.60% over the last year.

17. SanDisk Corp. (SNDK):
Semiconductor Industry. Market cap of $12.01B. TTM Gross Margin at 49.88% vs. industry average at 39.50%. TTM EBITDA Margin at 33.33% vs. industry average at 22.65%. TTM Pretax Margin at 30.17% vs. industry average at 19.16%. Short float at 3.29%, which implies a short ratio of 0.94 days. The stock has gained 77.72% over the last year.

18. Xilinx Inc. (NASDAQ:XLNX):
Semiconductor Industry. Market cap of $8.81B. TTM Gross Margin at 67.47% vs. industry average at 57.95%. TTM EBITDA Margin at 35.80% vs. industry average at 33.64%. TTM Pretax Margin at 33.08% vs. industry average at 23.48%. Short float at 11.86%, which implies a short ratio of 5.92 days. The stock has gained 37.51% over the last year.

19. Microchip Technology Inc. (NASDAQ:MCHP): Semiconductor Industry. Market cap of $7.14B. TTM Gross Margin at 66.40% vs. industry average at 57.94%. TTM EBITDA Margin at 39.16% vs. industry average at 33.58%. TTM Pretax Margin at 30.66% vs. industry average at 23.60%. Short float at 8.4%, which implies a short ratio of 7.73 days. The stock has gained 46.31% over the last year.

20. Cisco Systems, Inc. (NASDAQ:CSCO):
Networking & Communication Devices Industry. Market cap of $103.48B. TTM Gross Margin at 66.58% vs. industry average at 58.93%. TTM EBITDA Margin at 26.10% vs. industry average at 22.60%. TTM Pretax Margin at 21.19% vs. industry average at 18.06%. Short float at 0.71%, which implies a short ratio of 0.53 days. The stock has lost 22.43% over the last year.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.