It has been a very tough November for stocks with equities giving up a good portion of their huge gains in October. The upside to this market turmoil is that stocks are bigger bargains than they were a month ago. Here are three cash rich technology stocks with low valuations that are close to their 52 week lows worth considering for long term investors.
Logitech International (NASDAQ:LOGI) – “Logitech International S.A. designs, manufactures, and markets hardware and software products that enable digital navigation, music and video entertainment, gaming, social networking, audio, and video communication over the Internet, video security, and home-entertainment control. The company operates in two segments, Personal Peripherals and Video Conferencing”. (Business description from Yahoo Finance)
4 reasons LOGI appears to be a good value at $7.50 a share:
1. LOGI is selling near book value, at .5 times revenues and has over $2 of net cash on its balance sheet.
2. The stocks looks like it has technical support in the $7.50 to $8 range (See Chart)
3. Logitech is selling at the bottom of its five year valuation range based on P/E, P/B, P/S and P/CF.
4. The mean analysts’ price target on LOGI is $11.50.
Cohu, Inc. (NASDAQ:COHU) – “Cohu, Inc. engages in the development, manufacture, sale, and servicing of test handling and burn-in related equipment, and thermal sub-systems for the semiconductor industry worldwide. The company operates in three segments: Semiconductor Equipment, Microwave Communication Systems, and Video Cameras”. (Business description from Yahoo Finance)
4 reasons COHU is a bargain at $9:
1. COHU has a pristine balance sheet with over $4 a share in net cash. It also has a five year projected PEG of under .6.
2. The stock is selling at the bottom of its five year valuation range based on P/E, P/B, P/S and P/CF.
3. COHU also provides a dividend yield of 2.5% which should put floor under the stock
4. The one analyst that follows the equity has a $20 price target on COHU. COHU bottomed during March of 2009 along with the rest of the market at $8 so downside appears to be limited.
Broadcom Corporation (BRCM) – “Broadcom Corporation designs and develops semiconductors for wired and wireless communications. It provides a portfolio of system-on-a-chip (SoC) and software solutions for the manufacturers of computing and networking equipment, digital entertainment and broadband access products, and mobile devices, which enable the delivery of voice, video, data, and multimedia content to the home, office, and mobile environment”. (Business description from Yahoo Finance)
4 reasons Broadcom is a solid value at $30:
1. It has a cash rich balance sheet with almost $5 a share in net cash on its books.
2. The stock is selling at near the bottom of its five year valuation range based on P/E, P/B, P/S and P/CF.
3. It has a forward PE of 11 which an almost 50% discount to its five year average.
4. The median analysts’ price target on BRCM is $41.50 and Credit Suisse has a price target of $45 on Broadcom.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in COHU over the next 72 hours.