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One important consideration for tech stocks is how easily the companies can pay their ongoing capital expenditures. Operating cash flow is a likely source for this payment, so the ratio of operating cash flow to capital expenditures can give an idea of whether the firm’s fixed asset expenses are reasonably covered, leaving cash to spare.

We ran a screen on tech companies that appear highly undervalued, with lower TTM P/E, TTM P/CF, and PEG than their industry averages. We screened these companies for those with strong coverage of capital expenditures, with TTM operating cash flow/capital expenditures over 5. Theoretically, these companies can continue to operate for at least 5 more years without generating additional revenue, assuming costs do not change.

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.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month.

(Click chart for more detail)

Do you think these companies are undervalued? Use this list as a starting-off point for your own analysis.

List sorted by TTM operating cash flow/capital expenditures.

1. Altera Corp. (NASDAQ:ALTR): Semiconductor Industry. Market cap of $11.94B. TTM P/E at 13.45 vs. industry average at 15.15. PEG at 0.9 vs. industry average at 1.06. TTM P/CF at 12.84 vs. industry average at 14.33. TTM operating cash flow/capital expenditures at 40.83. The stock has performed poorly over the last month, losing 15.38%.

2. CACI International Inc. (NYSE:CACI): Technical Services Industry. Market cap of $1.49B. TTM P/E at 12.01 vs. industry average at 16.79. PEG at 0.93 vs. industry average at 1.21. TTM P/CF at 8.12 vs. industry average at 13.58. TTM operating cash flow/capital expenditures at 20.91. The stock is a short squeeze candidate, with a short float at 10.61% (equivalent to 8.65 days of average volume). The stock has performed poorly over the last month, losing 22.9%.

3. KLA-Tencor Corporation (NASDAQ:KLAC): Semiconductor Equipment & Materials Industry. Market cap of $6.06B. TTM P/E at 7.76 vs. industry average at 15.15. PEG at 0.82 vs. industry average at 1.06. TTM P/CF at 6.86 vs. industry average at 14.33. TTM operating cash flow/capital expenditures at 16.09. The stock has performed poorly over the last month, losing 12.49%.

4. Novellus Systems, Inc. (NASDAQ:NVLS): Semiconductor Equipment & Materials Industry. Market cap of $2.66B. TTM P/E at 8.34 vs. industry average at 15.45. PEG at 0.72 vs. industry average at 1.04. TTM P/CF at 7.07 vs. industry average at 14.29. TTM operating cash flow/capital expenditures at 15.10. The stock has gained 19.09% over the last year.

5. Xilinx Inc. (NASDAQ:XLNX): Semiconductor Industry. Market cap of $8.02B. TTM P/E at 12.68 vs. industry average at 14.57. PEG at 0.96 vs. industry average at 0.99. TTM P/CF at 11.43 vs. industry average at 13.61. TTM operating cash flow/capital expenditures at 14.16. The stock has performed poorly over the last month, losing 10.42%.

6. Applied Materials Inc. (NASDAQ:AMAT): Semiconductor Equipment & Materials Industry. Market cap of $15.45B. TTM P/E at 9.85 vs. industry average at 15.45. PEG at 0.99 vs. industry average at 1.04. TTM P/CF at 8.37 vs. industry average at 14.29. TTM operating cash flow/capital expenditures at 12.83. The stock has gained 7.33% over the last year.

7. SAIC, Inc. (SAI): Technical Services Industry. Market cap of $5.05B. TTM P/E at 9.23 vs. industry average at 16.85. PEG at 1.12 vs. industry average at 1.21. TTM P/CF at 7.59 vs. industry average at 13.56. TTM operating cash flow/capital expenditures at 12.47. The stock has performed poorly over the last month, losing 13.38%.

8. Blue Coat Systems Inc. (NASDAQ:BCSI): Business Software & Services Industry. Market cap of $733.63M. TTM P/E at 17.42 vs. industry average at 24.61. PEG at 1.42 vs. industry average at 1.45. TTM P/CF at 10.04 vs. industry average at 12.4. TTM operating cash flow/capital expenditures at 10.98. It's been a rough couple of days for the stock, losing 5.06% over the last week.

9. SanDisk Corp. (NASDAQ:SNDK): Semiconductor Industry. Market cap of $9.13B. TTM P/E at 7.24 vs. industry average at 17.22. PEG at 0.51 vs. industry average at 0.83. TTM P/CF at 6.38 vs. industry average at 11.32. TTM operating cash flow/capital expenditures at 10.65. Might be undervalued at current levels, with a PEG ratio at 0.62, and P/FCF ratio at 7.16. The stock has lost 9.28% over the last year.

10. Marvell Technology Group Ltd. (NASDAQ:MRVL): Semiconductor Circuits Industry. Market cap of $7.72B. TTM P/E at 10.02 vs. industry average at 15.45. PEG at 0.65 vs. industry average at 1.04. TTM P/CF at 8.03 vs. industry average at 14.29. TTM operating cash flow/capital expenditures at 9.70. It's been a rough couple of days for the stock, losing 6.17% over the last week.

11. Cisco Systems, Inc. (NASDAQ:CSCO): Networking & Communication Devices Industry. Market cap of $87.56B. TTM P/E at 13.72 vs. industry average at 24.61. PEG at 1.41 vs. industry average at 1.45. TTM P/CF at 9.8 vs. industry average at 12.4. TTM operating cash flow/capital expenditures at 8.59. The stock has had a couple of great days, gaining 7.42% over the last week.

12. Intersil Corporation (NASDAQ:ISIL): Semiconductor Industry. Market cap of $1.41B. TTM P/E at 15.0 vs. industry average at 15.15. PEG at 0.86 vs. industry average at 1.06. TTM P/CF at 9.59 vs. industry average at 14.33. TTM operating cash flow/capital expenditures at 8.24. The stock has gained 11.06% over the last year.

13. NVIDIA Corporation (NASDAQ:NVDA): Semiconductor Industry. Market cap of $8.05B. TTM P/E at 14.74 vs. industry average at 15.45. PEG at 0.97 vs. industry average at 1.04. TTM P/CF at 11.61 vs. industry average at 14.29. TTM operating cash flow/capital expenditures at 7.62. The stock has gained 49.67% over the last year.

14. Plantronics, Inc. (NYSE:PLT): Processing Systems & Products Industry. Market cap of $1.51B. TTM P/E at 14.33 vs. industry average at 19.31. PEG at 1.04 vs. industry average at 1.39. TTM P/CF at 12.73 vs. industry average at 12.75. TTM operating cash flow/capital expenditures at 7.46. The stock is a short squeeze candidate, with a short float at 8.8% (equivalent to 8.38 days of average volume). It's been a rough couple of days for the stock, losing 7.06% over the last week.

15. Lam Research Corporation (NASDAQ:LRCX): Semiconductor Equipment & Materials Industry. Market cap of $4.81B. TTM P/E at 6.67 vs. industry average at 15.45. PEG at 0.67 vs. industry average at 1.04. TTM P/CF at 5.98 vs. industry average at 14.29. TTM operating cash flow/capital expenditures at 6.91. The stock has gained 2.79% over the last year.

16. Dun & Bradstreet Corp. (NYSE:DNB): Information & Delivery Services Industry. Market cap of $3.23B. TTM P/E at 12.73 vs. industry average at 20.8. PEG at 1.2 vs. industry average at 1.29. TTM P/CF at 9.7 vs. industry average at 13.26. TTM operating cash flow/capital expenditures at 6.25. It's been a rough couple of days for the stock, losing 5.08% over the last week.

17. ESCO Technologies Inc. (NYSE:ESE): Scientific & Technical Instruments Industry. Market cap of $740.29M. TTM P/E at 12.26 vs. industry average at 14.35. PEG at 0.7 vs. industry average at 1.48. TTM P/CF at 8.8 vs. industry average at 9.12. TTM operating cash flow/capital expenditures at 6.06. It's been a rough couple of days for the stock, losing 7.14% over the last week.

*Price multiples sourced from Fidelity, operating cash flow/capital expenditures data sourced from Screener.co, all other data sourced from Finviz.

Source: 17 Highly Undervalued Tech Companies With Strong Cash Coverage