The realm of business services is garnering attention within the Zacks Rank #1 (Strong Buy) list, with 19 stocks in the sector receiving strong buy ratings. Among these top performers lie companies from the Zacks Technology Services Industry, a sector ranked in the top 30% of around 250 Zacks industries. Of particular interest are two technology services companies that recently went public and are poised for growth.
A Glimpse at Sofi Technologies
Sofi Technologies’ stock, priced under $10, presents an appealing investment opportunity as it expands its presence as a consumer-centric financial platform. Making its debut in 2021, Sofi is emerging as one of the most diversified fintech companies in the United States, offering a wide array of financial services including loans, credit cards, investments, insurance, and banking.
A noteworthy aspect is Sofi’s path towards profitability, with fiscal 2024 earnings estimates at $0.09 per share compared to an adjusted loss of -$0.36 per share in the previous year. Additionally, projections suggest a staggering 182% increase in FY25 EPS to $0.26.
The company’s robust revenue growth forecasts further bolster its future earnings potential, with total sales expected to increase by 18% this year and a projected 14% rise in FY25 to reach $2.81 billion.
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Exploring Qifu Technology
Qifu Technology, another recent IPO, is a dominant fintech player in China. Specializing as a credit tech platform, Qifu offers an extensive range of technology services catering to financial institutions, consumers, and enterprises involved in the loan lifecycle.
Impressively, Qifu’s stock has surged nearly +60% year-to-date, outperforming major Chinese tech giants like Alibaba and Baidu, with returns of -8% and -35% respectively.
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Investor interest in Qifu has been on the rise, fueled by the company’s profitability and a projected 34% increase in annual earnings for FY24 to $4.94 per share from $3.68 in 2023. Furthermore, FY25 EPS is anticipated to see a 4% rise. Enhanced by a low forward earnings multiple, Qifu’s stock appears attractively valued compared to major market players like Alibaba and Baidu.
Image Source: Zacks Investment Research
The Path Ahead
Both Sofi and Qifu have witnessed positive momentum in earnings estimates, underscoring their growth potential. The current landscape presents an opportune moment to consider investing in these promising technology services companies, positioning oneself for potential returns in 2024 and beyond.
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
