2 Mid-Cap Tech Stocks That Look Cheap

Board, Electronics, Computer, Electrical Engineering

The current rotation by investors out of pandemic winners and into outdoor-activity-oriented stocks, coupled with antitrust allegations faced by some trillion-dollar companies, has overshadowed several mid-cap technology companies that possess robust growth potential. Synnex (SNX) and Xperi (XPER) are two such stocks. We think they hold solid upside potential.

Technology companies that dominated the stock markets amid the COVID-19 pandemic last year because of the widespread adoption of remote lifestyles are gradually losing momentum with the global economy slowly returning to the pre-pandemic levels.

However, the continuation of the pandemic-driven trends even after the public health crisis is beaten is expected to help  tech companies thrive in the long-run. The global information technology market hit $7.85 trillion in 2020 and is expected to reach $11.87 trillion in 2025, growing at a CAGR of 9%. With most industries having a heavy reliance on technology, the ongoing investor rotation into non-tech, “outdoor” stocks is expected to be short lived.

Indeed, we think the current tech sell-off provides perfect entry points to some future winners. Because large-cap tech companies are currently under federal scrutiny and have yet to decline to reasonable valuations, mid-cap companies are expected to perform better as  demand for the  trillion-dollar names potentially rolls over to to mid-range names.

Two undervalued mid-cap stocks, Synnex Corporation (SNX - Get Rating) and Xperi Holding Corporation (XPER - Get Rating), have been introducing new features, which could translate into significant returns in future. So, we think it could be wise to bet on them now.

Synnex Corporation (SNX - Get Rating)

Headquartered in Fremont, California SNX delivers  a range of distribution, logistics and integration services for the technology industry and provides outsourced services focused on customer engagement strategies. The company operates through the Technology Solutions segment, and distributes peripherals, information technology (IT) systems, consumer electronics and complementary products. In addition, SNXoffers marketing services, serving  resellers, system integrators, and retailers.

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