Best Values in Large Cap Technology

Using the Ockham screening tool, we are focusing on the Tech sector today.  We filtered through the Ockham database of more than 8,000 stocks to zero in on technology stocks that are traded in USD (US stocks and ADR’s) and for this inquiry we are only including large cap stocks with more than $10 billion in market capitalization.  These tech stocks were some of the highest fliers during the rally last year, but the sector—as defined by the iShare IYW—has fallen about 12% from its high point about 6-weeks ago.  So, some of these stocks are looking more attractive on a fundamental valuation basis.  For that reason, we highlighted the 7 stocks that we view as Undervalued as of this week’s report for the value seekers out there.

Large Cap Tech Stocks Rated Undervalued by Ockham Research

Activision Blizzard (ATVI) Taiwan Semiconductor (TSM)
Broadcom Corp (BRCM) Texas Instruments (TXN)
Microsoft Corp (MSFT) Qualcomm (QCOM)
Symantec Corp (SYMC)

There are a number of commonalities among the stocks on this list other than their standing as Undervalued according to our methodology (for details on how we arrived at our rating, each of the tickers have been linked to their equity report on our website).  For example, these stocks are divided among only two industries within technology as all are a part of either the semiconductor hardware makers or the application software makers.  Also, these stocks have very strong balance sheets among them, as 4 of them have zero long term debt and Symantec (SYMC) has the most onerous debt load with just about 16% debt to assets.  All of the other stocks have very little need for debt as they generate cash rapidly without it.

About Ockham Research 645 Articles

Ockham Research is an independent equity research provider based in Atlanta, Georgia. Security analysis at Ockham Research is based upon the principle known as Ockham's Razor, named for the 14th- century Franciscan friar, William of Ockham. The principle states that a useful theory should utilize as few elements as possible, because efficiency is valuable. In this spirit, our goal is to make the investing environment as simple and understandable as possible, yet no simpler than is necessary.

We utilize this straightforward approach to value over 5500 securities, with key emphasis given to the study of individual securities' price-to-sales, price-to-cash earnings and other historical valuation ranges. Our long term value investing methodology is powered by the teachings of Ben Graham and it has proven to be very adept at identifying stock prices that are out of line with fundamental factors.

Ockham Research provides its research in a variety of forms and products including our company specific reports, portfolio analytics tools, newsletters, and blog posts. We also offer a white labeling research solution that can give any financial services firm their own research presence without the time and cost associated with building such a robust coverage universe of their own.

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