Many tech corporations have brought forth innovative products and services that challenge what is possible. These products and services have also resulted in substantial gains for long-term investors. This has led to this list of must-buy tech stocks.
While it’s easy to think about what could have been if an investor accumulated Amazon (NASDAQ:AMZN) stock in the 1990s, investors should focus on present opportunities. There are tech stocks that can double from here and reward investors as they continue to expand.
Investors looking for must-buy tech stocks leading the digital revolution may want to consider these three stocks.
Microsoft (MSFT)
Microsoft (NASDAQ:MSFT) has a long history of outperforming the market, and many of its top business segments are still growing. The tech conglomerate jumped up by 13% year-over-year in the first quarter of fiscal 2024.
Microsoft’s cloud products and services have been surging higher and heavily contributed to the company’s successful quarter. Microsoft is incorporating artificial intelligence into its cloud products to make them more valuable for businesses.
The company is also investing in quantum computing which can be the next innovative wave of tech. Microsoft has enough capital to get a head start on innovative technology and acquire companies that beat them to it.
Microsoft stock delivered a 63% gain over the past year. The stock is up by 293% over the past five years. Microsoft’s net profit margins are closing in at 40% and have a 39 P/E ratio. Analysts predict another 10% upside based on the average price target of $442.70.
Supermicro (SMCI)
Supermicro (NASDAQ:SMCI) looks ready to mirror Nvidia (NASDAQ:NVDA) and deliver robust revenue and earnings growth for several quarters. High growth rates can help the stock march much higher despite its 538% gain over the past year.
Supermicro is at the center of the artificial intelligence boom with its advanced AI servers and storage solutions. Artificial intelligence is innovative but requires significant computing power to operate smoothly. Supermicro has seen rising demand for its solutions which should continue for a while.
The company thrived long before artificial intelligence became mainstream. Corporations use Supermicro’s servers for cloud computing, 5G, and other tech. It explains why shares are up by more than 3,000% over the past five years. As good as the company’s 1-year gain has been, it has a proven record of outperformance.
The profitable company currently trades at a 44 P/E ratio. Supermicro looks poised to ride the AI trend and generate meaningful value for long-term investors.
ServiceNow (NOW)
ServiceNow (NYSE:NOW) offers a cloud platform that enables more productive workflows across organizations. ServiceNow aims to be the defining enterprise software of the 21st century and has over 8,100 global customers. That customer base includes 85% of the Fortune 500.
ServiceNow has tapped into generative AI to create additional value for its customers. This new offering contributed to ServiceNow’s successful quarter and elevated guidance.
Revenue growth remains strong for the company and came in at 25.5% year-over-year in Q4 2023. The firm has a 99% renewal rate among its customers and 1,987 customers with contracts exceeding $1 million in annual revenue. GAAP net income came in at $295 million which represents a 97% year-over-year growth rate.
ServiceNow has been an exceptional stock for several years. Shares are up by 74% over the past year and have gained 247% over the past five years. Shares trade at a high 59 forward P/E ratio. However, it’s easier for investors to overlook this valuation if they plan to hold onto this stock for at least five years.
On this date of publication, Marc Guberti held long positions in MSFT, SMCI, and NOW. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.