This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Nasdaq hits 13 year high — are there still value plays in tech?

By James Dennin for Kapitall.

The Nasdaq Composite 100 has had a killer week, climbing enough already to erase most of the losses it endured during tech's selloff throughout the early spring. The gauge fell around 8%, but as of this morning it is poised to close at a 13-year high.

However, a lot of the biggest gains haven't come from the kind of growth plays that usually generate the most hype amongst investors. 

Sturdy value stocks like Apple (AAPL) and Cisco (CSCO) have led the way, as many investors purchased shares at what they felt was a discount. Apple is up 19% since late April, although some of that is certainly due to excitement over Apple's prospective Beats deal. 

With that in mind, we decided to look for value stocks in the tech industry to see if there are any other companies that investors might have missed. 

These companies should be fairly large, with large cash reserves, trading relatively cheap multiples. Unlike growth investors, value investors are looking for value that's already there that the market has likely missed. 

To find value plays in tech, we started with a universe of American tech stocks with a market capitalization of $2 billion or higher. We then narrowed that screen for stocks that were undervalued by looking at levered free cash flow to enterprise value (LFCF/EV).

This means that the company has a lot of extra cash on hand relative to its size that it can deploy to grow the business or reward investors with dividends and buybacks. Either way, a high ratio of levered free cash to a company's size can also indicate that the company might be undervalued. 

This screen left us with 7 stocks on our list. Do you think they have room to grow? Use the list below to begin your analysis and let us know what you think in the comments. 

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $94.25 -0.98%
FB $118.18 0.64%
GOOG $699.24 0.99%
TSLA $228.77 -1.50%
YHOO $35.86 -0.42%


Chart of I:DJI
DOW 17,659.14 -91.77 -0.52%
S&P 500 2,050.11 -13.26 -0.64%
NASDAQ 4,727.0990 -36.1250 -0.76%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs