Table of Contents
Table of Contents
Best-Value Tech Stocks
Fastest-Growing Tech Stocks
Tech Stocks With the Most Momentum
Advantages of Tech Stocks
Disadvantages of Tech Stocks
The Bottom Line
These are some of the best tech stocks based on best value, fastest growth, and most momentum
By
Nathan Reiff
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Nathan Reiff has been writing expert articles and news about financial topics such as investing and trading, cryptocurrency, ETFs, and alternative investments on Investopedia since 2016.
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Updated June 01, 2024
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The technology sector, as tracked by the Technology Select Sector SPDR Fund (XLK) gained 7% in May. Names like NVIDIA Corp. (NVDA) reported earnings that blew away estimates, indicating the AI-driven rally still has room to run. That bullish sentiment was contrasted by the more conservative tone indicated in meeting minutes released on May 22 by the Federal Reserve, in which Fed officials voiced concerns about sluggish progress towards their 2% inflation target.
Below is an analysis of the toptech stocksfor June 2024, screened for best value, fastest growth, and most momentum. All data are current as of May 25, 2024.
Best-Value Tech Stocks
Value investingis an investing strategy that holds that investors can identify stocks that are trading below their true value. At the time the market corrects this mispricing, these undervalued namesmay increase in value. Investors typically attempt to identify undervalued stocks using fundamental metrics like the price-to-earnings (P/E) ratio. Typically, a lower P/E ratio signals an undervalued stock because the company is valued less than its fundamental value. These stocks may offer a stronger return after the market adjusts.
| Best-Value Tech Stocks | |||
|---|---|---|---|
| Price ($) | Market Capitalization (Market Cap) ($B) | 12-Month Trailing P/E Ratio | |
| SurgePays, Inc. (SURG) | 3.9 | 0.08 | 3.4 |
| Hello Group Inc. (MOMO) | 5.5 | 1.02 | 4.0 |
| iHuman, Inc. (IH) | 2 | 0.11 | 4.3 |
- SurgePays, Inc.:SurgePays, Inc. is a technology company that leverages its platform to provide financial and prepaid wireless services to underbanked communities through over 8,000 convenience stores across the U.S. The company saw major changes to its business model during the first quarter of 2024, including a shift away from its lead-generation business and a plan to expand its nationwide network.
- Hello Group, Inc.:Hello Group operates in China's online social and entertainment space, providing platforms like Momo and Tantan for users to discover new relationships, expand social connections, and engage in recreational activities. Momo focuses on location-based social interactions, while Tantan specializes in dating and romantic connections.
- iHuman, Inc.:iHuman Inc., is a provider of tech-powered intellectual development products, original content, and advanced technologies like artificial intelligence and augmented reality. In fiscal year 2023, iHuman saw significant growth in user engagement, with average total monthly active users increasing by 16% year-over-year. Other notable achievements include the international success of the Aha World app and the strategic acquisition of intellectual property related to Cosmicrew, a popular cartoon series.
Fastest-Growing Tech Stocks
Growthinvestors believe that increases in a company's revenue and earnings per share (EPS) can be an indicator of a strong business that has the potential to increase in value. However, focusing on just one or the other of these two metrics can give an incomplete picture of a company's growth potential. Circ*mstances unrelated to a company's fundamental business strength—such as tax law changes, mergers, or one-off gains—can skew these figures on their own.
Investopedia uses a dual-metric approach to reach a more balanced assessment of growth companies. We equally weight the latest year-over-year (YOY) percentage growth for both EPS and revenue. This approach aims to reduce the impact of those one-time anomalies to provide a better view of a company's true growth pattern and potential. Additionally, any companies with quarterly growth in excess of 1,000% are excluded as outliers.
| Fastest-Growing Tech Stocks | ||||
|---|---|---|---|---|
| Price ($) | Market Cap ($B) | EPS Growth (%) | Revenue Growth (%) | |
| TeraWulf Inc. (WULF) | 2.07 | 0.69 | 69 | 268 |
| Hut 8 Corp. (HUT) | 9.21 | 0.83 | 52 | 266 |
| EHang Holdings Limited (EH) | 16.02 | 1.01 | 27 | 165 |
- TeraWulf Inc.: TeraWulf is a vertically integrated bitcoin mine, operating two facilities in New York and Pennsylvania. In April, the company announced that it had mined 348 bitcoin, or 11.6 bitcoin per day, a decrease of 5% from March’s rate of production.
- Hut 8 Corp.: Hut 8 is a Bitcoin miner and provider of bitcoin mining hosting, data center services, and infrastructure development. Driven by increases in bitcoin prices, Hut 8’s first-quarter 2024 revenues rose 231% year-over-year, while generating a net income of $251 million.
- EHang Holdings Limited.: EHang is an urban air mobility technology company focused on enabling safe, eco-friendly air mobility. They provide unmanned aerial vehicle (UAV) systems for passenger transportation, logistics, smart city management, and aerial media solutions. In May, EHang’s EH216-S aircraft completed its first passenger-carrying demo flight in the United Arab Emirates.
Tech Stocks With the Most Momentum
Momentum investing is a strategy aiming to capitalize on pre-existing market trends by focusing on stocks that have outpaced their peers or the broader market on returns. This investment principal holds that stocks on an upward path are likely to continue to outperform, as long as fundamental aspects of the business, industry, or sector do not change.
Momentum investing is a common strategy applied to tech stocks because they regularly experience significant market disruptions. As companies launch new products, announce technological breakthroughs, and gain rapid popularity, investors have the potential to climb on board while these stocks are still ascending.
Here are the tech stocks with the highest total return in the last 12 months. We've excluded stocks with a share price of under a dollar.
| Tech Stocks With the Most Momentum | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing Total Return (%) | |
| Alarum Technologies Ltd. (ALAR) | 34.27 | 0.22 | 1501 |
| Exodus Movement, Inc. (EXOD) | 17.58 | 0.42 | 766 |
| MoneyLion, Inc (ML) | 93.84 | 1.02 | 735 |
- Alarum Technologies Ltd.: Alarum Technologies Ltd. provides global internet access and web data collection solutions through NetNut, the company's enterprise arm. Its proxy network enables customers to anonymously collect data at scale from any public web source. Alarum reported record record revenues in the first quarter of fiscal 2024, with revenues reaching $8.4 million, a 47% increase year-over-year. Key developments included the successful launch of the Website Unblocker and the AI Data Collector product lines.
- Exodus Movement, Inc.: Exodus offers a multi-asset software wallet designed to make cryptocurrency and digital assets accessible and user-friendly across desktop, mobile, and browser platforms. Through Exodus, users are able to securely manage and exchange over 10,000 asset pairs with complete control over their wealth. For the first quarter of 2024, the company achieved record revenue of $29.1 million, reflecting 118% growth, and processed $1.35 billion in exchange volume.
- MoneyLion, Inc.: MoneyLion offers a “super app” for consumers and an embedded finance platform for enterprises, providing personalized financial products, content, and marketing technology. For the first quarter of 2024, MoneyLion reported record revenue of $121 million, up 29% year-over-year.
Advantages of Tech Stocks
Growth potential
Tech stocks, particularly those in emerging areas, are known for experiencing some of the sharpest growth of any publicly traded company. Anticipating this, investors have sought periods in which the sector underperforms to invest heavily, as they expect significant growth over the long term.
But growth among tech stocks can vary dramatically. Many of the larger firms have limited growth potential because their market saturation and capitalization are already very high. Small-cap or penny tech stocks that experience technological breakthroughs or suddenly become incredibly popular may have periods of massive growth. Unusually, some of the biggest names in tech—including Amazon.com Inc. (AMZN), Meta Platforms Inc. (META), and Alphabet Inc. (GOOGL)—have continued to grow at significant rates.
Advanced innovation
Tech trends are always changing, with companies aiming to capitalize on the latest technology and to guide and follow developments in innovation. This makes the sector primed for breakthroughs. One of the most recent major trends to sweep the tech sector has been AI-related technologies, which are increasingly integrated into companies across many industries and sectors. To the extent that some tech companies continue to play a role in making this possible, they stand to benefit from the ongoing AI trend.
Disadvantages of Tech Stocks
Fluctuations in the tech sector
Tech stocks are known for their high volatility, where rapid technological changes and competitive pressures can lead to significant price fluctuations. They often carry high valuations based on growth expectations, making them susceptible to market corrections if they fail to meet these projections. Furthermore, regulatory challenges and geopolitical tensions can impact the sector, introducing additional risks and uncertainties for investors.
Trends shift quickly
The sharp gains of many tech firms can prove tempting to investors who may not be well-versed in the technologies themselves. With rapid innovation characterizing the sector, trends and prospects shift very quickly as well. Investors who are unprepared for this pace or who lack knowledge of the fundamental strengths of different tech companies may find themselves following a trend that has already changed.
Advantages
Growth potential
Advanced innovation
Disadvantages
Tech sector turbulence and rich valuations
Investors may be left behind with rapidly shifting trends
The Bottom Line
The tech sector's performance in 2024 is poised to be significantly influenced by advancements in AI, which is expected to drive long-term growth. The adoption of AI, along with ongoing digitization and cloud computing, offers promising opportunities, particularly for companies involved in semiconductor production and cloud software services. However, the macroeconomic environment will also play a key role in determining the sector's short-term performance, with the potential for volatility depending on interest-rate policies and economic conditions.
The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read ourwarranty and liability disclaimerfor more info.
As of the date this article was written, the author does not own any of the above securities.
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy.
Federal Reserve. "Minutes of the Federal Open Market Committee, April 30–May 1, 2024."
J. Heins and W. Tilson. "The Art of Value Investing: How the World's Best Investors Beat the Market." John Wiley & Sons, 2013. Chapter 2.
SurgePays. “SurgePays Announces First Quarter 2024 Financial Results”
Hello Group. “Hello Group Inc. Announces Unaudited Financial Results for the Fourth Quarter and Fiscal Year 2023”
iHuman. “iHuman Inc. Announces Fourth Quarter and Fiscal Year 2023 Unaudited Financial Results”
- TeraWulf.” TeraWulf Announces April 2024 Production and Operations Update”
Hut8. “Corporate Overview”
Alarum.” Alarum Announces Q1 2024 Results”
Exodus. “Exodus Reports Preliminary First Quarter 2024 Results”
- MoneyLion. “MoneyLion Announces First Quarter 2024 Results”
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