5 Tech Stocks That Have The Potential To Double
September 1, 2011 | includes: JDSU,
Many sectors hit seasonal highs and lows based on annual economic cycles. A number of investors believe that the 3rd or 4th week of September is historically the best time to buy tech stocks because they often bottom out at this time. It makes sense to make a shopping list of tech stocks that might be "on sale" in just a few weeks, especially ones that have a chance at doubling in the next year or two.
Some of these stocks are trading for about half of their 52 week highs, so all they would need to do is just return to their former highs in order to double. Others might need a buyout offer to double from recent levels and that is likely to happen for certain tech stocks because there are so many large tech companies with huge cash levels on the balance sheet. Earlier this year Texas Instruments (TXN) offered to buy National Semiconductor (NSM) for $25 per share which allowed that stock to just about double. Read more on that deal here.
Here is a closer look at some tech stocks that could double in the next year or two:
JDS Uniphase (JDSU) is a leading provider of fiber optics for the cable, telecommunications and networking industry. This stock used to be a high-flyer and even in the last 52 weeks it trades for almost $30 per share. Now it's trading for less than half of the 52 week high and for less than its historical valuations. This stock recently traded around $10 and if it re-tests those levels, the stock looks like a bargain and should be a potential double to $20 the next couple of years.
Here are some key points for JDSU:
Current share price: $12.97
The 52 week range is $9.09 to $29.12
Earnings estimates for 2011: 93 cents per share
Earnings estimates for 2012: $1.11 per share
PE Ratio: about 12
Annual dividend: none
Book value: $4.69 per share