3 Small-Cap Tech Stocks Rated 'Strong Buy'

human hand holding plasma ball

Image Source: Unsplash

Tech stocks are rising once again following a sell-off last month. The decline in benchmark Treasury yields this week is in sync with the Fed’s decision to maintain its dovish monetary policies at least over the near term. As a result, technology companies, particularly small-cap businesses, are borrowing extensively to take advantage of the “cheap money” scenario to augment their products and services.

The global IT services market is expected to grow from $3.5 trillion in 2020 to $5.73 trillion by 2025 at a CAGR of 11% over the five years.

While large-cap tech companies are currently near business saturation levels, small-cap companies are moving in to leverage high demand amid the hybrid working environment to market their unique services. This is why we believe small-cap tech stocks QAD Inc. (QADA - Get Rating), CTS Corporation (CTS - Get Rating), and Avid Technology, Inc. (AVID - Get Rating) will generate significant returns in the coming months.

QAD Inc. (QADA - Get Rating)

With a market cap of $1.27 billion, QADA provides cloud-based enterprise software solutions for global manufacturing companies across the automotive, life sciences, consumer products, food and beverage, high technology, and industrial products industries. It enables measurement and control of business processes and supports operational requirements, including financials, manufacturing, demand and supply chain planning, customer management, business intelligence, and business process management. The company markets its products through direct and indirect sales channels, and through distributors and sales agents also.

In February QAD Precision, a QADA division achieved  Team Tier status in the Veracode Verified program that validates a company’s secure software development processes. Also, QADA’s QAD DynaSys announced that month that QAD DynaSys Digital Supply Chain Planning (DSCP) had achieved the Veracode Verified Standard Status. Furthermore, in January, QADA completed the acquisition of a German-based company, Allocation Network GmbH, which is a best-in-class solution provider for strategic sourcing and supplier management.

For its fiscal 2021 fourth quarter, ended January 31, 2021, QADA’s total revenue increased 5.6% year-over-year to $82.98 million. Its gross profit has increased 13.6% year-over-year to $51.51 million. The company’s operating income for the quarter came in at $7.25 million, up 1965.8% year-over-year. QADA’s non-GAAP pre-tax net income came in at $10.11 million, which represents a 165.2% rise year-over-year. Also, its EPS attributable to Class A shares has increased 1850% year-over-year to $0.39.

1 2 3 4
View single page >> |

Disclaimer: Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use, please ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.