tech stocks to buy now

These tech stocks appear expensive on dollar value, but they are actually a steal considering their potential according to analysts.

Tech stocks are defying gravity in the midst of what may be the worst economic downturn in modern history. Even though valuations of some top tech stocks are at record highs, there are still some cheap but quality tech stocks available for grabs. The upcoming presidential election and economic uncertainty caused by the global health crisis could bring some volatility in the coming months, but that doesn’t really matter for long-term investors.

The Nasdaq Composite index has gained almost 22% year-to-date and is up over 60% from its March low. That strong rebound is unprecedented to many. Especially when you consider that the economic downturn driven by the coronavirus is far from over. The question here is, how should we navigate around the market during the pandemic? If you are not sure where to start looking for the best tech stocks to buy, you can start by zooming in on the emerging trends in the stock market.

Cloud computing, for instance, is expected to be a major force in the coming decade. Software has firmly supplanted hardware as the technology sector’s driver. Considering remote servers are being leaned on to manage and process large chunks of data, the need for cloud computing services couldn’t be more pronounced. But cloud computing isn’t the only place you’ll find growth stocks moving forward. We saw how beneficial e-commerce has been for businesses especially during the pandemic. It is therefore not surprising that investors have been bidding up stocks of Amazon (AMZN Stock Report) and Walmart (WMT Stock Report) to record highs. The good news here is, cloud computing isn’t the only technology area you’ll find growth. There are other areas in technology that have demonstrated explosive potential. With that in mind, do you have this list of top tech stocks to buy on your watchlist this week?

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Top Tech Stocks To Watch On October 2020: Carvana

While Carvana (CVNA Stock Report) is more of an automotive retail company, it has a clear tech angle to it given the company’s strong e-commerce channels. After making a huge jump last week, investors continue to bid up CVNA stocks, amid growing signs of consumer demand. The bullish momentum seems to have carried over from last week. That could simply be due to the positive comments of Piper Sandler analyst Alexander Potter. He raised his target price on Carvana to $265 from $209.

The pioneer in online car retailing is one of the best stocks to buy now according to analysts. There are many reasons to be optimistic about the company’s growth in the near to medium term. From this year’s second-quarter results, Carvana recorded a 13% increase in revenue year over year. Meanwhile, vehicle sales rose by 25%.

top tech stocks to buy (CVNA stock)

Management believes the pandemic will drive more customers to its e-commerce platform. If this plays out, it would accelerate the growth of Carvana’s business model in the long term. We seem to be moving in this direction as the days go by. Granted, Carvana is still far from profitability. But it is a relief that gross margins have been improving. Its recent financing will strengthen the company’s ability to fund growth. All these bode well for investors holding CVNA stock for the long term.

Top Tech Stocks To Watch On October 2020: Fastly

Shares of Fastly (FSLY Stock Report) jumped on Tuesday, rising to a high of $98.97 per share before closing 2.84% higher. Investors bid up FSLY stock as it looks less likely that the Trump administration will be able to ban TikTok app downloads. Investors have been paying close attention to development. That’s because the video-sharing app contributed 12% of Fastly’s revenue, according to the latest quarterly report. Hence, any signs of the video app continuing its service is a catalyst for a breakout in FSLY stock. 

A new article on Politico cited a federal judge, who stated that the TikTok app restrictions “likely exceed” President Trump’s legal authority. The article mentioned that TikTok and the Trump administration’s legal teams could meet “no later than Wednesday” for a discussion on the next steps. If it is indeed true that the ban seems unlikely, FSLY stock is likely to continue gaining ground.

top tech stocks to buy now (FSLY stock)

Many expect the market to be volatile with elections weeks away and the uncertainty about the recovery of the U.S. economy. Yet, within the rough seas, Fastly is a beacon on a firm footing. Analysts that took a closer look at Fastly like it a lot, and they are able to justify its lofty stock price. I don’t know about you, but I do believe there’s a great chance that FSLY stock would rise, with or without TikTok. 

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Top Tech Stocks To Watch On October 2020: DouYu International

DouYu (DOYU Stock Report) is a Chinese video gaming and esports-focused live streaming company that went public in July 2019. The company has Tencent (TCEHY Stock Report) as its major shareholder. That speaks volumes of the company’s ability to scale its business in the long run. The company is comparable to Amazon’s Twitch for its ability to allow people to watch video games live. 

The company’s adjusted fiscal 2020 earnings could jump by over 235% to $0.57 a share. Sales are likely to rise by 27% to reach $1.32 billion. Looking ahead, FY21 earnings per share could increase by another 37%, while revenue would likely be about 30% higher. While DOYU stock has taken a hit as part of the broader tech sell-off in September, the stock is 52% higher year-to-date.

best tech stocks to buy now (DOYU stock)

Investors should know that Tencent proposed in August that DouYu enters into a stock-for-stock merger with rival HUYA (HUYA Stock Report). In the long run, DouYU could benefit from a synergistic combination with streaming rival Huya. Such a merger could bring synergistic effects including the elimination of redundancies. And that could lead to stronger profit margins and steadier growth. But investors are reminded to practice caution when buying stocks over rumors. While it could give you an explosive return should the deal indeed go through, it will also backfire in an equal magnitude if it fails to materialize.

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