Almost half of this fund’s assets are allocated to 10 companies, including all Magnificent Seven stocks. Many investors have done well by spreading their capital across tech stocks, but some are in better positions than others.
Recent dips, strong earnings and competitive advantages are some of the dynamics that make some tech stocks more attractive than others. Comparing many investment opportunities can help determine which ones present better prospects for long-term investors. These are three of the tech stocks that can result in long-term gains.
Crowdstrike (CRWD)
For better or for worse, your summer will be unforgettable with this stock. Crowdstrike (NASDAQ:CRWD) is under fire for a global IT outage that affected many businesses and consumers. The company has been on damage control ever since. Luckily, most of the woes are over, as 97% of Windows seniors are back online.
Shares were up by more than 50% year-to-date before the IT outage. Now, the stock is down year-to-date. Delta (NYSE:DAL) asking for Crowdstrike to cover its lost revenue looks like one of the last big obstacles before Crowdstrike can proceed to rebuild its reputation and grow again.
Patient investors who can wait at least three years may view this recent dip as attractive. Crowdstrike isn’t the first company to make a major mistake, and it most certainly won’t be the last. The company has over a decade of experience and has built significant trust over that stretch. Investors, business owners and consumers will gradually forget about this episode within the next 1-2 years. Meanwhile, Crowdstrike delivered 33% YOY revenue growth in Q1 FY25. Net income surged from $0.5 million to $42.8 million in one year.
Amazon (AMZN)
Let’s now look at a stock with less scrutiny than Crowdstrike. Amazon (NASDAQ:AMZN) is a household name for the right reasons. Its online marketplace is second to none, with millions of products, free 2-day shipping and numerous perks. Many business owners use Amazon Web Services to store data, and that segment is experiencing a boost thanks to artificial intelligence. Amazon also owns Twitch and Whole Foods.
It’s very hard to avoid Amazon; you can see that reality in the company’s financial results. The tech giant delivered 13% YOY revenue growth amid rising growth from Amazon Web Services and Amazon Advertising segments. Domestic and international sales both achieved double-digit growth rates.
Investors will have a hard time finding anyone who is bearish about Amazon stock. It’s rated as a Strong Buy among 44 analysts, and the stock only has Buy ratings. The average price target suggests a 23% upside. Even the lowest price target of $200 per share implies that Amazon stock is set to reward investors with more gains.
Duolingo (DUOL)
Duolingo (NASDAQ:DUOL) is the smallest company with a $7.5 billion market cap. The stock hasn’t had the best stretch since its IPO and is down by 19% year-to-date. However, the educational tech firm looks poised to deliver gains for patient investors.
Revenue jumped by 45% year over year in the first quarter to reach $167.6 million. While sales continue to grow, the company’s rising profits are a big development. Duolingo reported $27.0 million in net income, compared to a $2.6 million net loss in the same period last year.
A rapidly growing user base supports the company’s financial strength. Duolingo now has almost 100 million monthly active users, while daily active users increased by 54% YOY. The app helps people learn languages through guided verbal and written lessons. It’s also expanding into other subjects like math and music to attract more users. As people increasingly learn new things online, Duolingo is positioned to thrive.
On this date of publication, Marc Guberti held long positions in CRWD and AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Marc Guberti is a finance freelance writer at InvestorPlace.com who hosts the Breakthrough Success Podcast. He has contributed to several publications, including the U.S. News & World Report, Benzinga, and Joy Wallet.