Two Bargain Tech Investments for 2020

February 14, 2020
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Bargain stocks are ideal for expanding a portfolio without taking on too much risk. With picks under $10, it’s possible to purchase long term holdings with a minimal investment.

The tech industry has been a key driver in the stock market rally of 2020. Although most of the trading activity is in the large blue-chip stocks, there are smaller companies that deserve a closer look.

Here are two stocks for this year that are bargain-priced and full of potential.

Pixelworks Inc. (NASDAQ: PXLW)

Pixelworks develops semiconductors, integrated circuits, and software applications for visual display processing. Its technologies can be found in everything from smartphones to high definition televisions, and even digital billboards.

High demand for both consumer and enterprise electronics will keep Pixelworks busy over 2020 and the coming years. The company prolifically innovates, and its licensed technologies are a strong source of revenue.

Revenue declined by -10% in the 2019 fiscal year, but this coincided with a slump in global smartphone sales. Demand for Apple and Samsung smartphones has increased in recent months, which indicates that phone sales should start to trend upwards again.

Even with the revenue decline, Pixelworks generated a 49.72% profit margin last year, an impressive figure for a company that is heavily focused on research and development.

Stock is up 43.40% over the last three months and analysts predict a strong upside for this bargain pick.

Orion Energy Systems Inc. (NASDAQ: OESX)

This company designs, manufactures, and supplies commercial lighting systems in the United States. As a vertically integrated company, it has complete control of its business from research and development, all the way to consulting and installation.

Orion Energy Systems Inc. focuses heavily on high-efficiency LED lighting systems. These can reduce total power consumption at large commercial properties, keeping both cost and environmental impact low. The company has been growing in popularity and prominence, with enterprise customers being particularly interested in its products.

This interest has translated to strong sales growth. In the previous quarter, Orion’s revenue was up 110%. In 2020, revenue is expected to increase by at least 135% year over year.

While this stock doesn’t attract the glamor of the big tech picks, its bargain price and growth trajectory make it a strong option for any portfolio.

Stock in Orion is currently up 84.18% year to date, making it one of the strongest performers in today’s bull market.

Developing a Robust Investment Portfolio

Bargain stocks help to increase the exposure of an investment portfolio, with a relatively low amount of capital risk. The low price tech stocks above are well worth considering as we move deeper into the first quarter.

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