4 Best Tech Stocks for Momentum Investors Right Now

The momentum gained in the first half of 2017 continues, marking the remarkable run that the stock market has had this year. The NASDAQ Composite (IXIC), the S&P 500 (GSPC) and the Dow Jones Industrial Average (DJI) have rallied 27.1%, 18.4% and 23.1%, respectively, so far in 2017.

Among sectors, technology continues to shine, with the Technology Select Sector SPDR ETF (XLK) registering a return of 31.5% year to date.

Technology Sector: Strong Prospects

Factors fueling the technology sector are increasing demand for cloud-based platforms and the growing adoption of Artificial Intelligence (AI) solutions.

Huge demand for power-efficient as well as high performance chips — essential to run cloud-data centers and process massive data by using Big Data analytics — machine learning and deep learning tools has been a key driver of technology stocks.

Moreover, escalating demand for sensors and software for autonomous vehicles, advanced driver assisted systems (ADAS), Augmented/Virtual reality devices (AR/VR) and Internet of Things (IoT) are noticeable catalysts to growth.

The lighting pace at which the 5G platform and technology are evolving is also worthy of mention.

In view of these bullish sentiments, momentum investing can be a winning strategy for those seeking high returns in a short span. This strategy focuses on hot stocks that have been gaining over the past few weeks or months.

Today, we’ve zeroed-in on some tech stocks using our premium screen Momentum Style Score.

Where to Put Your Money?

Finding the right momentum stocks is not easy due to market volatility, but if executed properly, these can be the star performers of your portfolio.

It is here that our new Style Score System can come in handy. The Zacks Momentum Style Score indicates the right time to grab a stock and make the most of its momentum. Back-tested results show that stocks with a Style Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy), easily outperform others.

Here is the list of the four best tech stocks for momentum investors right now:

Arista Networks, Inc. ANET is engaged in providing cloud networking solutions for data centerand cloud computing environments. The company’s robust product portfolio is driving top-line growth. Strong demand for its 100-gigabit routing and switching products, particularly from cloud titans has been a key growth catalyst

Arista Networks sports a Zacks Rank #1 and has a Momentum Style Score of A. It delivered positive surprises in each of the trailing four quarters, with an average beat of 27.5%. Moreover, the company is witnessing upward estimate revisions — up 2% to $5.33 per share for 2017 and 2% to $6.14 per share for 2018, respectively — in the last 30 days.

Based on the Zacks Consensus Estimate, we expect Arista Networks to finish fiscal 2017 with EPS growth of 61.6% and sales growth of 45.4%. That expansion is expected to continue next year, with current estimates hinting at earnings growth of 15% and revenue growth of 25.2%.

Shares of Arista Networks have gained 130.2% year to date, outperforming the 20.3% rally of the industry it belongs to.

NVIDIA Corporation NVDA  is a worldwide leader in visual computing technologies and the inventor of the graphic processing unit (GPU), which is a high-performance processor generating realistic, interactive graphics on workstations, personal computers, game consoles and mobile devices.

The EPS estimate for the current year has been revised upward to $4.19 from $4.07 per share in the last 30 days. Also, based on the Zacks Consensus Estimate, NVIDIA is expected to finish the current year with EPS growth of 63% and sales growth of 37%. This expansion is expected to continue next year, with the current estimates anticipating earnings growth of 11.4% and revenue growth of 16%.

The stock flaunts a Zacks Rank #1 and has a Momentum Style Score of A.

Shares of NVIDIA have gained 79.4% year to date, substantially outperforming the 38.8% rally of the industry it belongs to.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Lam Research Corporation LRCX supplies wafer fabrication equipment and services to the semiconductor industry. The improving WFE market, strong demand for server DRAM and increased adoption rates of 3D NAND technology will continue to drive growth for the company.

Lam is witnessing upward estimate revisions — up 2 cents to $14.74 per share for the current year in the last 30 days.

Based on the Zacks Consensus Estimate, Lam is anticipated to finish the fiscal year with EPS growth of 47.7% and sales growth of 28.8%.

On top of this, Lam is currently a Zacks Rank #1 stock and has a Momentum Style Score of B.

Shares of Lam Research have gained 76.4% year to date, substantially outperforming the 56.8% rally of the industry it belongs to.

Marvell Technology MRVL  is a fabless designer, developer and marketer of analog, mixed-signal and digital signal processing integrated circuits. Strong demand for Marvell’s 4G LTE products could be a growth driver. Also, its deal to acquire Cavium will broaden its offerings beyond hard disk drives microprocessors and enter into high growth areas such as data centers and wireless communications.

The EPS estimate for the current year has been revised upward to $1.19 from $1.14 per share in the last 30 days. Also, based on the Zacks Consensus Estimate, Marvell Technology is expected to finish the current year with EPS growth of 88.2% and sales growth of 0.76%.

The stock carries a Zacks Rank #2 and has a Momentum Style Score of B.

Shares of the company have risen 58.9% on a year-to-date basis, underperforming the industry’s increase of a meager 44.4%.

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Marvell Technology Group Ltd. (MRVL) : Free Stock Analysis Report
 
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