After a momentous rally in tech stocks over the past several months, the market’s now in correction territory. With many of the biggest tech stocks notching higher highs during the first quarter (Q1) of the year, many had predicted a stock market breather. However, the pullback presents an excellent opportunity for investors to hunt for multibagger tech stocks.
Investing in the stock market plan without a clear strategy can be incredibly daunting. It’s like being a kid at a candy store with thousands of options. In such a case, investors must narrow down sectors with the most promise for long-term expansion. Betting on long-term trends, especially in the tech space, can potentially generate tremendous gains. With that in mind, I’ve curated a list of potential multibagger tech stocks targeting three of the biggest investing trends in artificial intelligence (AI), robotics, and resource management.
Multibagger Tech Stocks: SoundHound (SOUN)
SoundHound (NASDAQ:SOUN) is a frontrunner in conversational AI, a market poised for colossal expansion over the next few years. It has established a firm foothold in the market, growing rapidly in recent quarters. Moreover, its client list is an exhaustive catalog of the who’s who in tech, telecommunications, dining, and transportation.
SOUN stock soared in mid-February, propelled by the news of AI giant Nvidia’s (NASDAQ:NVDA) ownership position in the firm. Despite a significant pullback in the past month, losing over 30% of its value, the stock has shown resilience. The dip, largely attributed to the company’s plans to sell up to $150 million in new stock, has been met with optimism by analysts who project a potential 23% upside in SOUN stock.
Furthermore, the upside in its stock is also linked to its robust growth trajectory over the next couple of years. The company expects fiscal 2024 sales to fall in the $63 million to $77 million range, beating analyst estimates of $69.73 million at the mid-point. Looking to fiscal 2025, SoundHound expects sales to top an impressive $100 million while adjusted EBITDA is expected to be positive.
Symbotic (SYM)
Symbotic (NASDAQ:SYM)is an industrial robotics specialist managing supply chains within large warehouse environments. It makes use of robotics and AI to effectively manage distribution center operations with greater efficiency.
The industrial robotics market is a robust trend in the tech space, demonstrating substantial growth on a global scale. To provide a clear picture, the market was valued at $17 billion in 2023, and is projected to potentially reach $32.5 billion by 2028. A staggering statistic is the total number of robots produced by Amazon (NASDAQ:AMZN), which skyrocketed by 7,400% to 750,000 from 2013 to 2023. Furthermore, robots handle approximately 75% of all products in Amazon, underscoring the industry’s potential.
Hence, industry leaders such as Symbotic should benefit immensely from the trend. Its Q1 2024 results showed a 79% increase in sales from the prior-year period. What’s more impressive is that its net loss of $68 million in Q1 2023 dropped by a massive 81% to $13 million in Q1 2024.
Itron (ITRI)
Itron (NASDAQ:ITRI) is a tech company that’s developing products and services aimed at managing energy and water resources. Needless to say, it is addressing one of the biggest long-term trends in the management of critical resources. Itron’s innovations in resource management could be pivotal in dealing with the global demand for energy and water.
Itron is an excellent stock to invest in overall. It has bounced back impressively from the pandemic-led slowdown to deliver robust sales and earnings growth last year. Moreover, its net income is now firmly in the green after three challenging years of posting net losses. Consequently, ITRI stock shot up more than 79% last year and is up 25% year-to-date (YTD), outperforming the broader market. Despite the ascent though, ITRI stock still trades just 1.85 times forward sales estimates, 35% lower than the sector median. Moreover, Tiprank’s analysts assign a ‘strong buy’ rating to ITRI stock, with a 13% upside from current price levels.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.