If you’re looking for tomorrow’s investment winners, the technology sector is one the best places to start. It has produced plenty of market-smashing stocks in recent decades, and artificial intelligence (AI) is a massive opportunity that could create tremendous wealth for investors in the coming years.
Here are two tech stocks ripe for the picking in November.
1. Micron Technology
Shares of Micron Technology (MU -0.12%) rose to a high of $157 earlier this year before pulling back to around $100 at the time of this writing. That dip has made the stock’s valuation even more attractive, as the most recent earnings report still showed surging demand from data centers for the company’s high-capacity memory products.
Micron has seen a sharp rebound in its revenue over the last year. In its fiscal 2024 fourth quarter, which ended Aug. 29, revenue jumped 93% year over year, showing the company’s growth accelerating. Strong demand trends are lifting its margins, which caused Micron’s earnings per share to more than double over the year-ago quarter.
Earnings should continue to grow as Micron shifts more production to higher-margin products such as high-bandwidth memory that are expected to see surging demand in the new year. Management is seeing demand coming from AI and traditional servers, which indicates broad strength across the data center market.
Micron is ramping production up as much as it can to meet demand, as supply is the chief factor limiting its sales. This will significantly benefit the company’s margins. On average, Wall Street analysts currently expect Micron’s adjusted earnings per share to jump from $1.30 in its fiscal 2024 to $8.93 in its fiscal 2025, according to Yahoo Finance.
In light of these trends, the stock’s valuation looks attractive at just 11 times next year’s earnings. Relative to its expected fiscal 2026 results, the stock carries an even cheaper forward price-to-earnings (P/E) ratio of 8. Micron shareholders are looking at potentially substantial upsides over the next few years.
2. HubSpot
HubSpot (HUBS 3.14%) offers an easy-to-use platform that helps small businesses manage services, marketing, and sales. It has delivered robust growth in recent years and produced phenomenal returns for its investors. The stock is up 18% since the company reported its third-quarter results in early November.
Revenue grew 20% year over year on a constant-currency basis in Q3, driven by 10,000 net customer additions — bringing the total customer count to 238,000 — and continued spending by established customers. It reported strong customer interest in new AI features such as a new Copilot assistant, which is currently in beta testing.
These were solid results during a relatively weak year of growth for leading software providers. Businesses have been hesitant to spend money on software, but HubSpot has met the challenge. While it expects revenue growth to slow again to approximately 16% year over year in the fourth quarter, Wall Street is starting to give the company more credit for its long-term opportunities and ability to improve margins.
HubSpot is showing signs of building a durable competitive moat. Its adjusted operating margin improved from 16.5% in Q3 2023 to 18.7% in Q3 2024. This was an excellent performance following management’s move to reduce prices to win more customers. It demonstrates the ability to be competitive on pricing and still grow profits, which helps explain why the stock is moving higher.
On a price-to-sales basis, the shares still look attractive at a multiple of 14. The stock has soared by more than 2,000% since its IPO in 2014, but its average P/S ratio over the last decade was just over 12. With HubSpot still in growth mode, investors can anticipate earning returns that are consistent with the company’s revenue growth over the long term.
John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends HubSpot. The Motley Fool has a disclosure policy.
