5 Best Performing Tech Stocks in 2015
As many investors know, 2015 was a year when tech stocks had been essentially flat, compared to their high performance in several other years. Despite that a few tech companies created tremendous shareholder value in 2015, and it is strongly possible that the following stocks will be able to produce solid gains again in the coming year too.
Here are 5 stocks that produced substantial positive gains in 2015, and are poised to continue that momentum in 2016.
Facebook’s stock has outperformed the NASDAQ by a margin of 5:1 in 2015, trading higher by 30%. Since Facebook’s 2012 IPO, FB stock has more than doubled the performance of the NASDAQ, thriving in advertising and mobile. It now has a slew of new projects to push the company forward.
Experts believe, the company could have another memorable year in 2016. A new partnership with Uber, which has the service available through Facebook Messenger, is just another step FB has taken to diversify itself and its abilities, mentions research firm Zacks.com.
FB user growth also grew 12.6% year-over-year in its most recent quarter, and the company-owned Instagram topped 400 million users this past September, a number continues to grow. Another company acquisition, Oculus Rift, resides in the virtual reality market that was recently projected by recode.net to grow to $70 billion by 2020. Though Oculus Rift is far from scratching the surface of its potential, it could begin to produce FB investor benefits in 2016, especially as FB begins to ramp up its marketing efforts for the VR platform.
Technology giant Alphabet, the company formerly known as Google, also had an extremely strong year in 2015, as the company’s stock is up by over 40%. The future continues to look bright for Alphabet heading into 2016; the company has standout assets like Google Search, Android, Chrome, and YouTube, each of which has over 1 billion users.
The company continues to be aggressive with implementing new monetization systems to improve revenue growth. For example, Alphabet recently introduced install ads where the company gets a fee when a user downloads an app as well as the creation of new ad formats. YouTube Red, a $9.99 per month premium service, currently only available in the U.S., is supposed to be rolled out globally over the course of 2016.
Alphabet and Ford Motor are reportedly creating a joint venture to build self-driving cars. The partnership would have Google’s technology to develop the automated driving technology, and Ford would take care of the manufacturing aspect. Pymnts.com predicts that what may be on the verge of occurring is that Alphabet/Google is getting extremely close to passing Apple as the most valuable company by market cap.
Graphic design, publishing, and imaging software company Adobe Systems offers top-tier products for major growth areas like its Creative Cloud, which includes apps like Photoshop, Illustrator, Premiere Pro, and various other apps. It also has a marketing cloud that helps companies improve results on platforms like Alphabet, Facebook, and Twitter.
ADBE has seen its stock rise to over 25% over the course of 2015, and it is extremely possible that that momentum will carry into 2016. The company too believes so, as during its latest analyst meeting, it presented a bullish case for long-term growth, forecasting annual earnings growth of 30% on average as well as revenue growth of 20% until fiscal 2018.
Over the past few years, Adobe has made bold moves to the cloud that have yielded strong results, and investors could be enjoying more good times ahead as the company continues to improve itself, states Zacks as, investors could see these statistics change for Adobe in the near future.
2015 proved to be a good year for tech giant, Microsoft, as the company’s stock has gained nearly 20%. Microsoft, like Adobe, has moved a great deal of its focus toward the cloud, and it is paying off. Just in its most recent quarter, Microsoft reported that cloud sales rose 8.8% to $5.9 billion.
While 2015 was solid for the Surface Pro-maker, it appears that 2016 could be just as fruitful, if not more so. The company has seen growth that is likely to accelerate in 2016, and the market is quickly catching on. Microsoft is expected to deliver EPS growth of 13.6% in 2016, which will be a 6.6% increase in revenue. Though those numbers may not seem incredibly high, one must keep in mind that growth numbers like that are very solid for an old-line mega cap tech firm that does more than $90 billion in annual sales.
As cloud sales continue to accelerate, Microsoft will likely continue to be a solid stock pick, believe investors. Barron’s Magazine suggests that there’s another 30% worth of upside within the next 18 months. According to the current Wall Street analyst recommendations, only 59% of the analysts covering Microsoft have it ranked a buy and 12% actually have it ranked a sell.
However, compared to some of its peers, Microsoft is likely to see a lot more action in the way of upgrades in 2016, a significantly bullish indicator.Another factor that bodes well for the company moving forward is a slower than expected decline in its biggest segment that includes Windows, Xbox, and Surface Tablets. It should also be noted that the results from Windows 10 are expected to make up for those losses felt in Microsoft’s other segment, and together with cloud services, the company is capable of producing more growth and earnings beats in the coming year.
The bull case on Amazon.com, stock got easier to make after it converted an already strong holiday selling season into something far more valuable, as millions of new customers signed up for Amazon Prime. Needless to say, Amazon Stock is a Staggering Buy for 2016 Amazon Prime, the basket of goodies including free two-day shipping and access to streaming movies and music — stands with Amazon Web Services as one of the two pillars of the retailer’s future growth.
As we know, AWS is where the hype is. Cloud-based computing is in a gold rush with giants such as Alphabet’s Google, Microsoft and other dominant players. Amazon keeps the number of Amazon Prime members a closely-guarded secret, but suffice to say it’s expanding at a remarkable rate. As part of what it’s touting as a record-breaking holiday season, the company said it signed up more than 3 million new Amazon Prime members during the third week of December alone, writes stock analyst Dan Burrows on InvestorPlace.
Deutsche Bank analysts think that by 2020 Amazon Prime could be worth $70 billion. That’s roughly 25% of what the entirety of the company is worth today.
While 2015 will be a forgettable year in the stock market, what sets these tech stocks apart, though, is that despite solid performances in 2015, each one is capable of producing solid gains in 2016. As the year comes to a close, many investors will reassess their holdings, and as Zack researchers conclude, with these companies likely enjoying continued success next year, each one should be considered as a potential investment.
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