The technology hardware industry powers the digital world by creating essential physical components. Investors look to buy potential tech stocks Quantum Corporation (QMCO), Seiko Epson (SEKEY) and Transact Technologies Inc. (TACT) for November gains as demand rises there’s a possibility that.
The technology hardware industry is constantly evolving, with new trends replacing old ones. Global technology companies invest heavily in research and development to stay ahead of the curve and create innovative products, making this industry the largest and most profitable company in the world.
The IT hardware market, which includes the manufacturing and sales of computer hardware, is driven by the IT industry’s growing need for advanced hardware solutions that support digital transformation, cloud computing, and emerging technologies. This year’s market revenue is expected to reach $121.32 billion.
The IT hardware market is expected to grow at a CAGR of 7.9% to reach $177.11 billion by 2028.
Moreover, the global revenue of the IT services market is expected to grow significantly from 2023 to 2028, with a total increase of 42.7% to $529.5 billion. This continued growth trend is expected to drive revenue to $1.8 trillion by 2028, marking a new peak after eight consecutive years of expansion.
Additionally, increased digitalization investments in various sectors are increasing the demand for hardware such as servers and data centers. Additionally, the introduction of emerging technologies such as AI, machine learning, and IoT are increasing the demand for hardware due to complex processing and data storage needs.
With these favorable trends in mind, let’s take a look at the fundamentals of the three best technology hardware stocks, starting from #3.
Stock #3: Quantum Corporation (QMCO)
QMCO is a global provider of storage and data management solutions for a variety of industries. The company offers products for high-performance data applications, video surveillance, data archiving, and more. The company’s services include support, software subscriptions, and partners with companies such as Tiger Surveillance to provide comprehensive solutions.
QMCO’s CapEx/Sales for the trailing twelve months was 2.91%, which was 20.1% higher than the industry average of 2.42%. The company’s trailing 12-month asset turnover is 1.89x, which is 205.1% higher than his industry average of 0.62x.
On October 11, 2023, QMCO introduced DXi Edge-Core-Cloud Bundles, a comprehensive data protection and ransomware recovery solution. These bundles leverage the efficiency of Quantum’s DXi Series backup appliances, available in four capacity sizes from 400 TB to 228 Petabytes, and offer a cost-effective way to protect data across an enterprise’s various locations. and up to 70x more efficient than other bundles. Backup solution.
On September 13, the company launched preconfigured bundles for ActiveScale Cold Storage, a cost-effective solution for archiving data, reducing cold storage costs by up to 60%. These bundles simplify data retention and are available in sizes from 10 to 100 petabytes.
ActiveScale is suitable for a variety of sectors, providing scalable and durable storage for unstructured data, data analytics, AI workloads, and long-term data retention. This initiative streamlines the purchasing and deployment process for organizations seeking efficient data management.
During the fiscal first quarter ended June 30, 2023, QMCO generated total revenue of $91.79 million. The company’s non-GAAP gross profit increased 2.1% year over year to $35.18 million. Additionally, non-GAAP total operating expenses decreased 2.3% year over year to $35.45 million. Additionally, adjusted EBITDA increased 122.8% year over year to $770,000.
The company expects second fiscal quarter 2024 sales of approximately $80 million (with a potential range of plus or minus $3 million), non-GAAP gross margin of approximately 42%, and adjusted EBITDA of approximately $2 million. I expect it to be USD.
Analysts expect QMCO’s revenue to increase 4.6% year-over-year to $370.05 million for the fiscal year ending March 2025. The company has exceeded revenue estimates in each of his three subsequent quarters, which is great.
QMCO stock rose slightly during the day, closing the last session at $0.46.
QMCO’s POWR rating reflects this robust outlook. The stock has an overall rating of B, which equates to a Buy according to our proprietary rating system. POWR ratings are calculated by considering 118 different factors, with each factor weighted to the best degree.
QMCO’s value is B grade. Ranked #12 out of 41 stocks in the Technology & Hardware industry with a B rating.
Click here for additional growth, momentum, stability, sentiment, and quality ratings for QMCO.
2nd stock: Seiko Epson Corporation (Seki)
SEKEY is based in Suwa, Japan and specializes in the development, manufacturing, and sales of information equipment. The company has three main business segments: visual communications; wearables and industrial products; We manufacture printers, projectors, wearable devices, and industrial equipment.
SEKEY’s trailing twelve month net profit margin of 3.90% was 84.8% higher than the industry average of 2.11%. His 12-month CAEXSales of 3.77% is 55.8% higher than the industry average of 2.42%.
On October 24th, SEKEY announced the GX-B series of high power density SCARA robots, including the GX10B, at the Assembly Show. The RC700E controller with integrated SafeSense technology powers these robots, providing high performance, flexibility, and safety features.
The controller enables human-robot interaction without safety barriers, increasing productivity. Key features include ease of use, low total cost of ownership, and Industry 4.0 readiness with OPC UA connectivity.
On October 12th, SEKEY announced the SureColor P5370, a 17-inch professional photo printer aimed at professional and production photographers. It features an improved printhead, a wider color gamut with a 10-color ink set, and advanced printing features.
This printer supports roll-feed, auto-cut, various media sizes, and offers easy touchscreen operation. It also features multiple connectivity options, including Wi-Fi, and advanced software to increase productivity.
For the six months ended September 30, 2023, SEKEY generated revenue of 638.53 billion yen ($4.27 billion), a slight increase year-over-year. The company’s gross profit was 213.57 billion yen ($1.43 billion) and EPS was 82.87 yen. Additionally, net cash from operating activities increased 192.9% year-on-year to 61.51 billion yen ($411.69 million).
Street expects SEKEY’s sales to increase 2.4% year over year to $2.29 billion in the first quarter ending June 2024.
The stock has increased 1.8% over the past year, closing at $7.08. Additionally, stock prices rose slightly during the day.
SEKEY’s POWR Rating reflects this positive outlook. The stock has an overall rating of B, which equates to a Buy according to our proprietary rating system.
SEKEY has an A grade for value and a B grade for stability and quality. It ranks 9th in the industry.
Click here for additional growth, momentum, and sentiment ratings for SEKEY.
Stock #1: TransAct Technologies Incorporated (tact)
TACT is a global leader in software-driven technology and printing solutions for high-growth markets. The company creates, develops, and sells transactional and specialty printers and terminals for a variety of industries, including food service, point of sale, casino, and gaming. The company provides thermal printers, consumables, and software solutions to a wide range of customers around the world, from OEMs to end users.
TACT’s gross margin for the trailing twelve months was 50.68%, which was 2.6% higher than the industry average of 49.41%. The company’s trailing 12-month EBIT margin was 7.59%, which was 54.5% higher than the industry average of 4.91%.
TACT’s net sales and gross profit for the second quarter ended June 30, 2023 were $19.91 million and $10.86 million, an increase of 57.7% and 99.8%, respectively, from the same period last year. Adjusted operating income and net income were $2.69 million and $2.16 million, respectively, an increase of 190.9% and 190.7% year-on-year. Furthermore, the company’s adjusted EBITDA increased by 225.2% to $3.18 million.
The company expects fiscal 2023 net sales to be between $71.5 million and $73.5 million. Additionally, TACT expects his total adjusted EBITDA to be in the range of $8 million to $8.5 million.
TACT’s sales for the fiscal year ending December 2023 are expected to increase 24.5% year-on-year to $72.4 million, and EPS for the same year is expected to be $0.32. The company beat revenue expectations in each of his four subsequent quarters.
Shares have soared 48.3% over the past year, closing at $5.93.
TACT’s POWR Rating reflects this promising outlook. The stock has an overall rating of A, which equates to a “Strong Buy” according to our proprietary rating system.
TACT has an A grade for Values and Emotions and a B grade for Quality. Ranked 2nd in the industry.
Click here to see additional POWR ratings for TACT on Growth, Momentum, and Stability.
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SEKEY stock was trading at $7.04 per share Tuesday morning, down $0.04 (-0.56%). Year-to-date, SEKEY has fallen -4.09%. In comparison, the benchmark S&P 500 index rose 15.51% in the same period.
About the author: Kritika Sarma
An interest in risky financial products and a passion for writing led Kritika to become an analyst and financial journalist. She earned a Bachelor’s degree in Commerce and is currently enrolled in the CFA program. She aims to help investors identify untapped investment opportunities with her fundamental approach. more…
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