Last year was a watershed moment for many tech stocks, rebounding from the setbacks they faced in 2022. The tech-savvy Nasdaq Composite closed the year up 43%, outshining the S&P 500 and Dow Jones.
Despite the resurgence of tech stocks in 2023, there are a few standouts that deserve bold investment moves. Here are three tech stocks with the potential to power up investors’ portfolios over the long haul.
Taiwan Semiconductor Manufacturing Company
Taiwan Semiconductor Manufacturing (NYSE: TSM), the world’s largest semiconductor (chip) foundry, may not resonate as a household name, but its role in the tech ecosystem is crucial and vastly underrated. TSMC’s groundbreaking chips have positioned the company as a linchpin for tech behemoths like Apple, Tesla, and Nvidia.
The surge in TSMC’s 2023 stock performance can be largely attributed to the buzz around artificial intelligence (AI). Although TSMC itself isn’t directly involved in AI, the companies relying on its chips, such as Nvidia and Advanced Micro Devices, are. Despite the AI hoopla, the anticipated rebound in smartphone and PC markets is expected to propel TSMC’s revenue growth back on track.
The company’s dominance in chipmaking technology is unmatched by any other big-name semiconductor corporations. As a long-term investment, TSMC exudes unwavering confidence.
Microsoft
After surging nearly 62% in 2023 and overtaking Apple as the world’s most valuable public company, Microsoft (NASDAQ: MSFT) is basking in unparalleled resurgence. With its involvement in enterprise and consumer software, cloud computing, gaming, and AI, Microsoft stands as a formidable force across multiple industries. This is prominently reflected in its financials.
All three of Microsoft’s business segments experienced revenue growth year over year in the first quarter of its fiscal year 2024. The Intelligent Cloud segment, which encompasses revenue from its cloud platform, Azure, took the lead with a 19% year-over-year growth to $24.3 billion.
Microsoft’s diverse business portfolio underlines its resilience and its capacity to deliver compelling value to shareholders in the years to come.
CrowdStrike
Cybersecurity trailblazer CrowdStrike (NASDAQ: CRWD) has ridden a rollercoaster since its IPO in June 2019. Despite the turbulence, its 2023 surge of 142% catapulted it close to its all-time peak, fueled by its pioneering AI-native cybersecurity solutions. In the third quarter of its fiscal 2024, its revenue soared by 35% year over year, reaching $786 million.
Of greater significance is CrowdStrike’s annual recurring revenue (ARR), which spiked by 35% year over year to $3.1 billion. For a subscription-based business like CrowdStrike, ARR provides a more accurate indication of long-term financial robustness by reflecting predictable income and offering insights into customer retention. CFO Burt Podbere aims to achieve $10 billion in ARR within five to seven years.
Given the surging demand for cybersecurity across businesses with online operations, CrowdStrike’s prominence in the industry positions it as a long-term winner despite expected volatility.
