The technology industry has experienced tremendous growth over the past year due to increased investor interest in technology, particularly in areas such as generative AI and cloud computing. The technology industry benchmark ETF is the Technology Select Sector SPDR Fund (NYSEARCA:XLK), up 45% over the past year. S&P500It’s up just 32% over the same period.
Investing in stocks with strong fundamentals is essential for any investment portfolio aiming for stable growth. Investors should pay close attention to underlying fundamentals such as revenue growth, free cash flow, and earnings per share (EPS) and other metrics to determine whether a company is worth investing in for the long term.
Here we gain exposure to the generative AI industry and other innovative technologies, identifying solid technology companies with very strong fundamentals that still offer investors upside potential. I will introduce some of them.
Salesforce (CRM)
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sales force (New York Stock Exchange:CRM) offers customers a variety of cloud-based generative AI products for collecting sales data, forecasting, and consumer data.
On February 28, Salesforce announced its fiscal 2024 fourth quarter earnings, saying total revenue increased 11% year-over-year and operating cash flow increased 44%.
Other large technology companies meta platform (NASDAQ:meta) and Nvidia (NASDAQ:NVDA) offers investors quarterly initial dividend payments, and Salesforce has done the same. Currently, the dividend yield is 0.13%, and each quarter he will be paid 40 cents per share.
Salesforce offers a wide range of generative AI products to help streamline your business processes. These products have enabled rapid growth, and Salesforce stock has risen nearly 60% over the past year. Salesforce’s continued product rollouts, including a new data cloud technology known as Einstein Copilot, support future upside potential.
Nvidia (NVDA)
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Nvidia (NASDAQ:NVDA) is a leading semiconductor company that manufactures GPUs for gaming PCs and provides data center infrastructure.
Over the past year, the company has become one of the biggest technology movers, with stock price growth more than tripling due to increased investor interest in generative AI and related technologies.
On February 24, Nvidia reported its fiscal 2024 fourth-quarter earnings, saying total revenue soared more than three times year-over-year and net income increased more than eight times. The major business segments experienced growth, most notably, sales for the Data Center and Professional Visualization businesses increased by over 400% and over 100% year over year, respectively.
As mentioned earlier, Nvidia announced its first quarterly dividend to investors. This results in a quarterly annual dividend yield of 0.02%, or 4 cents per share.
Nvidia offers investors excellent fundamentals and the potential for continued growth. Its exposure to the AI industry makes it a stock that investors should keep an eye on.
ServiceNow (now)
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ServiceNow (New York Stock Exchange:now) operates an automation platform for digital companies in a variety of industries, including communications, manufacturing, and IT services.
Over the past year, the company’s stock has soared more than 75%, driven by growth in automation technology and the potential of the generative AI industry.
ServiceNow beat analyst expectations in its most recent earnings report for the fourth quarter of 2023, released on January 24th. The report stated that total revenue increased 26% year-over-year. Regarding future earnings forecasts, the company has raised its forecast for sales in the first quarter of 2024 to increase by 24% compared to the same period last year, and by 24.5%.
ServiceNow recently acquired NetACE Network Technology and 4Industry to strengthen its automation technology business.
ServiceNow has expanded its business and is experiencing rapid growth with steady growth in subscriber revenue and a solid foundation. This stock is a no-brainer for investors looking for cutting-edge technology companies.
As of this writing, Noah Bolton does not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer and are subject to InvestorPlace.com Publishing Guidelines..
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