Seeking Alpha
Value, growth at reasonable price, deep value, contrarian
Profile| Send Message|
( followers)  

Many sectors hit seasonal highs and lows based on annual economic cycles. A number of investors believe that the 3rd or 4th week of September is historically the best time to buy tech stocks because they often bottom out at this time. It makes sense to make a shopping list of tech stocks that might be "on sale" in just a few weeks, especially ones that have a chance at doubling in the next year or two.

Some of these stocks are trading for about half of their 52 week highs, so all they would need to do is just return to their former highs in order to double. Others might need a buyout offer to double from recent levels and that is likely to happen for certain tech stocks because there are so many large tech companies with huge cash levels on the balance sheet. Earlier this year Texas Instruments (NASDAQ:TXN) offered to buy National Semiconductor (NSM) for $25 per share which allowed that stock to just about double. Read more on that deal here.

Here is a closer look at some tech stocks that could double in the next year or two:

JDS Uniphase (NASDAQ:JDSU) is a leading provider of fiber optics for the cable, telecommunications and networking industry. This stock used to be a high-flyer and even in the last 52 weeks it trades for almost $30 per share. Now it's trading for less than half of the 52 week high and for less than its historical valuations. This stock recently traded around $10 and if it re-tests those levels, the stock looks like a bargain and should be a potential double to $20 the next couple of years.

Here are some key points for JDSU:

  • Current share price: $12.97
  • The 52 week range is $9.09 to $29.12
  • Earnings estimates for 2011: 93 cents per share
  • Earnings estimates for 2012: $1.11 per share
  • PE Ratio: about 12
  • Annual dividend: none
  • Book value: $4.69 per share

Advanced Micro Devices (NYSE:AMD) is a leading maker of computer chips. This stock recently dipped to about $5.60 and I think it is likely to re-test those lows. If it does, I would buy as it could double from that level and rise to around $11 in the next couple of years as demand increases with a stronger economy.

Here are some key points for AMD:

  • Current share price: $6.83
  • The 52 week range is $5.57 to $9.58
  • Earnings estimates for 2011: 59 cents per share
  • Earnings estimates for 2012: 80 cents per share
  • PE Ratio: about 8
  • Annual dividend: none
  • Book value: $2.38 per share

Micron Technology (NASDAQ:MU) is a leading maker of semiconductors for the computer industry. This stock is trading for about half of the 52 week high so all it needs to double is a return to that level around $12. The stock looks cheap but to roughly double it might need to see a takeover offer just like National Semiconductor (NSM) did when Texas Instruments (TXN) offered to acquire the company for $25 per share.

Here are some key points for MU:

  • Current share price: $5.91
  • The 52 week range is $5.18 to $11.95
  • Earnings estimates for 2011: 33 cents per share
  • Earnings estimates for 2012: 60 cents per share
  • PE Ratio: about 10
  • Annual dividend: 48 cents per share which yields 1.5%

Corning Inc. (NYSE:GLW) is a maker of specialty glass products including the glass used on flat screen televisions and some of the most popular tablet computers and mobile phone devices. Corning is trading barely above book value of $13.56 per share and for only trading for 7 times earnings, it is a bargain. With Corning trading at almost half of its 52 week high, a case can easily be made for a double in the next year or two.

Here are some key points for GLW:

  • Current share price: $14.89
  • The 52 week range is $13.15 to $23.43
  • Earnings estimates for 2011: $1.97 per share
  • Earnings estimates for 2012: $2.16 per share
  • PE Ratio: about 7
  • Annual dividend: 20 cents per share which yields 1.4%
  • Book value: $13.56 per share

Applied Materials (NASDAQ:AMAT) is a leading maker of manufacturing equipment, for semiconductor, flat panel display, and solar industries. This stock offers a great dividend yield of nearly 3% and a low price to earnings ratio of only 8. This stock might need a buyout offer to double in the near future, but in the long run it's easy to make a case for this stock to trade around $20.

Here are some key points for AMAT:

  • Current share price: $11.32
  • The 52 week range is $10.27 to $16.93
  • Earnings estimates for 2011: $1.41 per share
  • Earnings estimates for 2012: $1.33 per share
  • PE Ratio: about 8
  • Annual dividend: 32 cents per share which yields 2.8%
  • Book value: $6.21 per share

Data is sourced from Yahoo Finance. No guarantees or representations are made. Hawkinvest is not a registered investment advisor and does not provide specific investment advice. The information is for informational purposes only. You should always consult a financial advisor.

Source: 5 Tech Stocks That Have The Potential To Double