Investors know that technology stocks from semiconductor firms to cloud computing companies have helped lift the overall market for years. Despite newly heightened drama in Washington D.C. and the ongoing uncertainty regarding the U.S. and China trade war, both the Dow and S&P 500 rest near their all-time highs.
Overall, with interest rates so low, it seems likely that stocks continue to climb, especially the right stocks. With this in mind, we searched using our Zacks Stock Screener for large-cap, blue-chip technology firms that boast stable, growth businesses…
1. Adobe ADBE
Adobe helped revolutionize the modern digital age when it invented the Portable Document Format, better known as the PDF, in the early 1990s. Today, the company sells a variety of offerings, from its suite of creative software such as Photoshop to cloud-based subscription solutions for businesses. One of the company’s newer units aims to capitalize on the rapid rise of digital media, that has turned everyone into content creators. Adobe Spark allows users to create web pages, graphics, and short videos “in minutes.” The firm, which has seen its stock price surge 26% in 2019 to crush S&P 500 and its industry’s 18% climb, on September 17 topped Q3 fiscal 2019 earnings and revenue estimates.
Looking ahead, our Zacks Consensus Estimates call for Adobe’s adjusted fourth-quarter earnings to jump 23.5% on 20.5% higher revenue. The company’s full-year fiscal 2019 EPS figure is expected to pop 16% on 23.5% sales growth that would see it reach $11.15 billion. This would match 2018’s 23.7% surge and mark the continuation of between 22% and 25% sales expansion over the last three years. ADBE’s fiscal 2020 earnings are then projected to jump 24% higher on 17% stronger revenue. Adobe has also seen its 2019 earnings estimate revision activity trend heavily upward to help it earn a Zacks Rank #2 (Buy).
ABDE also sports an “A” grade for Growth in our Style Scores system and its shares have blown away its peer group—which includes Salesforce CRM, Oracle ORCL, and others—over the last two years, up 95%, against 44%. Despite its climb, Adobe shares currently rest roughly 9% below their 52-week highs.
2. Intuit INTU
Intuit is part of the same Zacks peer group as Adobe that also includes VMware VMW and Symantec SYMC. Shares of INTU have surged 87% in the past 24 months and 37% in 2019, to crush its peer group’s 12% climb. Intuit offers a variety of financial services geared toward taxes, small business money management, and personal finance. Intuit’s software-as-a-service products include QuickBooks and TurboTax. And the company’s relatively easy to use cloud-based offerings have helped it accumulate roughly 50 million users globally.
Intuit currently holds a Zacks Rank #2 (Buy) and its board last quarter approved a new quarterly dividend of $0.53 per share, which will be payable on October 18. The company’s new payout marks a 13% increase from last year’s $0.47. The firm’s current quarter (Q1 fiscal 2020) sales are projected to jump 10.6% to $1.12 billion. Overall, INTU’s full-year fiscal 2020 and 2021 revenues are expected to climb 10.6% and 10%, respectively.
Meanwhile, the company’s adjusted fiscal year EPS figures are projected to jump by 12.5% in each of the next two years. The firm has also crushed our quarterly earnings estimates by an average of 54.7% over the trailing four quarters.
3. Microsoft MSFT
Microsoft is the most well-known company on this list and its shares have crushed all of the so-called FAANG stocks over the last 12 months—blowing away second and third placed Facebook FB and Google GOOGL. MSFT is the only company currently in the trillion-dollar market cap club, as Apple AAPL continues to jump in and out. The Redmond, Washington-based company’s legacy businesses, such as Office and Windows have evolved and it is now the second-largest could computing firm behind only Amazon AMZN. The company also recently announced that it raised its quarterly cash dividend by 11% and approved a new stock buyback program.
The company’s new projected annualized dividend of $2.04 per share puts its current yield at roughly 1.46%, while the 10-year U.S. Treasury note sat at 1.69% Thursday afternoon. Moving on, Microsoft’s fiscal 2020 revenue is projected to surge 11.2% to hit $139.88 billion, with fiscal 2021 expected to jump 10.5% higher to reach $154.50 billion. Meanwhile, MSFT’s earnings are projected to climb 10.1% and 12.8%, respectively.
Microsoft boasts an “A” grade for Growth and “B” for Momentum at the moment, along with a Zacks Ranks #2 (Buy). Plus, Microsoft is trading at a discount compared to its peer group in terms of forward 12-month earnings estimates and it is hardly stretched compared to where MSFT has traded within the last few years.
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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
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Alphabet Inc. (GOOGL) : Free Stock Analysis Report
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Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
salesforce.com, inc. (CRM) : Free Stock Analysis Report
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