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While some tech stocks are dozing off, a new wave of innovative players is poised to shake up the industry. These hidden gems operate in fields experiencing explosive growth, including streaming, e-commerce, and artificial intelligence.
The buzzword focuses on stocks that are “waking up” and with a new bull market in place, investors need to prepare for what the future holds. These companies are highly integrating AI to create faster, smarter, and more efficient solutions that give them a powerful advantage. As AI reshapes the world as we know it, these three tech stocks are solidifying their status as sleeping giants.
So let's unpack the three best tech stocks that are ready to take the plunge into 2024.
Netflix (NFLX)
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Netflix (NASDAQ:NFLX) We ended the 2023 fiscal year on a strong note, with increased profitability driven by price increases and new advertising plan memberships. The company ended the year with a 12% increase in sales due to a significant expansion in operating margins. Additionally, FCF hit a record high of $6.9 billion, exceeding the latest forecast of $6.9 billion for Q3 2023.
Netflix is currently taking all appropriate steps while battling a more challenging macroeconomic environment over the past 24 months. Consumers have significantly reduced discretionary spending, impacting revenue and revenue. But strategic steps like creating new advertising plan memberships and cracking down on password sharing are paying off.
We saw 70% quarter-on-quarter growth with the introduction of advertising plan memberships. This has created significant revenue growth opportunities as the company looks to expand its advertising revenue platform. Netflix expects revenue of $9.24 billion in the first quarter of fiscal 2024, reflecting approximately 13% year-over-year growth. Operating margins are expected to expand by 520 basis points in the quarter, making Netflix one of the best tech stocks to buy in 2024.
Shopify (Shop)
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Shopify (New York Stock Exchange:shop) is a leading e-commerce company and is set to have a great year in 2024. After implementing cost-cutting measures in 2023, profitability and gross margins continue to trend in the right direction.
Shopify stock has rebounded significantly in recent months, rising more than 80% since November 2023. Investors are bullish on management's execution and ability to grow top and bottom lines in FY24. After cutting 20% of its workforce and selling its logistics business to Flexport in 2023, Shopify's liquidity is stronger than ever.
The company plans to announce its fourth quarter and full year results on February 12, 2024. The company expects fourth-quarter sales growth to be in the low to mid-teens and full-year sales growth in the mid-20s. Additionally, Shopify expects its fourth quarter gross margin to be 46%, an increase of 300-400 basis points from the fourth quarter of 2022. With a net cash position of over $4 billion, Shopify is well-positioned to accelerate his growth in 2024 and beyond.
Spotify (Spot)
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spotify (New York Stock Exchange:spot) is the world leader in music streaming and has emerged as the darling of the tech world in 2024. As of Q4 2023, the company boasts 602 million MAUs and is on track to reach 1 billion MAUs in the coming years.
Spotify had a strong fiscal year 2023, and management is confident it can deliver continued growth in 2024. The company hit a very clear inflection point in his third quarter of 2023. wall street It's getting more and more bullish. During the quarter, Spotify announced his earnings surprise of 0.33 cents per share. Gross margins continue to expand and FCF continues to increase. In Q4 2023, Spotify's FCF ballooned to $396 million.
Beyond financials, Spotify offers other unique competitive advantages. Our first-mover advantage in music streaming and aggressive expansion into podcasts have solidified our position in the market. Additionally, we leverage data and AI to personalize your experience. This can drive user engagement and increase advertising revenue. With profitability expected to accelerate in FY2024, Spotify is one of the best tech stocks to buy in 2024.
On the date of publication, Terrell Miles did 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 influenced by InvestorPlace.com. Publishing guidelines.
