Tech Charter for 2020 and 5 Popular Stocks

  • Dec 31, 2019 AEDT
  • Team Kalkine
Tech Charter for 2020 and 5 Popular Stocks

What a year so far!!!

With only a day left in the year, the S&P/ASX All Australian 200, S&P/ASX 200, and S&P/ASX 200 Information Technology indices all surged on a year-to-date basis. The recent potency comes on the back of cautious phase one trade deal between the US and China, coupled with robust economic indicators prediction from the world’s two largest economies.

On top of that, the tech industry could keep rolling in 2020 on the heels of better-than-expected adoption of cloud computing solutions amid the ongoing digital transformation of enterprises, driven by an increase in the usage of artificial intelligence (AI) and machine learning (ML) technologies.

The S&P/ASX 200 Information Technology has been one of the top-performing indices in 2019, with more than 35% return on a year-to-date basis.

Markedly, the S&P/ASX 200 indices have gained around 21% year to date and S&P/ASX All Australian 200 indices also rallied about 21% over the same period.

Tech so Far

Technology so far has become more of a fluid thing, filling gaps we never felt occurred, getting people closer to each other, making life much simpler and more comfortable, and entering zones that we never thought existed.

For organisations, this meant a bring your own device (BYOD) trend, bridging the gap between consumer and enterprise usage. This trend, along with a complete revolution in mobile computing with tablets, hybrids and many more technologies, enables employees to carry their devices almost anywhere and everywhere or even work from home.

Another revolution that has changed our lives is the contraction and focus of computer power, with smaller integrated circuits and large screen phones along with minicomputers, storing every bit of data and information needed in our day to day life.

Apart from all the data and information running between devices and clouds, telecom networks have also witnessed a revolution. The ever-increasing implementation of 5G technology is establishing further growth prospects. Also, software-defined networking has reduced networking costs for enterprises.

Data mining, ML and AI have been a natural follow-on, and it’s evident that in the coming days, people with the maximum data will become a leader and will hold the most vital prospect in the tech space.

Tech Sector Appears Shiny Heading Into 2020

The technology sector is likely to start 2020 on a promising note, following a favourable a recovery in the chip market, among other factors. We note that strong adoption of cloud computing solutions, driven by the growing use of AI and ML technologies, is a key favourable factor.

Worldwide chip and semiconductor markets are expected to recover in 2020. According to media sources, the global chip market is set to grow by 5.9% in 2020, after an expected fall of 12.8% in 2019.

Also, constant improvement in electronic devices and chief breakthrough enhancements will lead to robust adoption of wearables and smart-connectivity solutions, containing smart speakers and virtual reality/augmented reality (VR/AR) devices.

Moreover, technical progress in the telecommunication sector on enhanced implementation of 5G technology and robust attempts in the direction of modification in Internet infrastructure should act as tailwinds.

Oh, Did We Miss?

Nothing is free. All the things mentioned above come with a price. Security issues, thefts, data breaches, and confidentiality issues have become common household issues. Whether the coming decades will solve it or not remains a question, but the increasing number of lawsuits accumulating reveal that there will be clarity of duties and responsibilities.

Will everything be perfect in the future? We have our doubts, but one thing that we can be sure of is that we’ll make more improvement and progress.

5 Popular Stocks

With a positive outlook for the tech industry, investors might want to add a few tech-focused stocks to their portfolios. We have identified four tech stocks with strong fundamentals that investors might want to consider for 2020.

Telstra Corporation Limited (ASX: TLS)

Telstra Corporation Limited is Australia’s leading technology and telecommunication, which provides a broad range of telecommunication and information services like internet and pay television, and mobiles. The company is developing future for expertise and competencies in products and technologies that comprise the Internet of Things, cloud computing, machine learning and artificial intelligence and big data. Total income for Telstra in FY19 stood at $27.8 billion.

Stock Performance

Telstra Corporation has a market cap of $43.29 billion with ~ 11.89 billion outstanding shares. The company’s stock price closed at $3.540 on 31 December 2019, down by 2.75% relative to the previous close.

The Citadel Group Limited (ASX: CGL)

A software and technology company, the Citadel Group Limited provides secure enterprise information management to boost decisions making process across the Health, National Security, Defence and Other companies. For FY20, the company anticipates an encouraging return to revenue and EBITDA and a low double-digit increase in organic revenue. The company expects FY20 margins to be in accordance with FY19.

The company is dedicated to safeguarding people and secure data. CGL anticipates creating shareholders’ value in the long run. The company expects progress in recurring SaaS and software-based services revenue on the heels of the higher implementation of Citadel 2.0 approach.

Stock Performance

Citadel Group Limited has a market cap of $245.54 million with ~49.31 million outstanding shares. The company’s stock price closed at $4.920 on 31 December 2019, down by 1.2% relative to the previous close.

Appen Limited (ASX: APX)

Founded in 1996, Appen Limited is a supplier and developer of data solutions for artificial intelligence and machine learnings applications. The company has over 180 unique languages with a solid grip in the AI-based data annotation platform in the industry. The company reported revenues of $245.1 million for the half-year ended 30 June 2019, an increase of 60% year over year.

Outlook for FY19:

The company anticipates underlying EBITDA to be in the range of $96 million to $99 million in FY19. Additionally, earnings are expected to gain from higher monthly relevance revenues and increasing margins. The company expects ARR outlook for the same period to be in the range of $30M - $35M (at A$1=US$0.74).

Stock Performance

Appen Limited has a market cap of $2.84 billion with ~ 121.11 million outstanding shares. The company’s stock price closed at $22.460 on 31 December 2019, down by 4.181% relative to the previous close.

Altium Limited (ASX: ALU)

Altium Limited is one of the largest providers of PCB design kits and components. The company also provides data management software and creates next-generation electronic products and systems. Altium’s leading product is known for its skill in 3D Printed Circuit Board (PCB) Computer. For the FY19 (period ended 30 June 2019), the company’s revenues stood at US$171.8 million, up 23% year over year. For FY20, the company expects revenues to be in the range of US$ 205 million – US$ 215 million.

Stock Performance

Altium Limited has a market cap of $4.73 billion with ~ 130.97 million outstanding shares. The company’s stock price closed at $34.72 on 31 December 2019, down by 3.93% relative to the previous close.

Nearmap Ltd (ASX: NEA)

A technology-driven company, Nearmap has provided a platform for frequently reorganised and high-resolution aerial imagery for companies, businesses and governments. The data-based company offers online PhotoMap content for 88%, 65-70% and 70% of the population in Australia, US, and New Zealand, respectively. For FY19 (period ended on 30 June 2019), the company increased its revenue by 45% year over year to $77.6 million.

Outlook

The company aims to execute its growth plans and foresees annualised contract value for the group in the range of $116 million to $120 million for FY20.

Stock Performance

Nearmap has a market cap of $1.19 billion with ~452.46 million outstanding shares. The Nearmap stock price closed at $2.630 on 31 December 2019, down by 3.42% relative to the previous close.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Tech so Far

Technology so far has become more of a fluid thing, filling gaps we never felt occurred, getting people closer to each other, making life much simpler and more comfortable, and entering zones that we never thought existed.

For organisations, this meant a bring your own device (BYOD) trend, bridging the gap between consumer and enterprise usage. This trend, along with a complete revolution in mobile computing with tablets, hybrids and many more technologies, enables employees to carry their devices almost anywhere and everywhere or even work from home.

Another revolution that has changed our lives is the contraction and focus of computer power, with smaller integrated circuits and large screen phones along with minicomputers, storing every bit of data and information needed in our day to day life.

Apart from all the data and information running between devices and clouds, telecom networks have also witnessed a revolution. The ever-increasing implementation of 5G technology is establishing further growth prospects. Also, software-defined networking has reduced networking costs for enterprises.

Data mining, ML and AI have been a natural follow-on, and it’s evident that in the coming days, people with the maximum data will become a leader and will hold the most vital prospect in the tech space.

Tech Sector Appears Shiny Heading Into 2020

The technology sector is likely to start 2020 on a promising note, following a favourable a recovery in the chip market, among other factors. We note that strong adoption of cloud computing solutions, driven by the growing use of AI and ML technologies, is a key favourable factor.

Worldwide chip and semiconductor markets are expected to recover in 2020. According to media sources, the global chip market is set to grow by 5.9% in 2020, after an expected fall of 12.8% in 2019.

Also, constant improvement in electronic devices and chief breakthrough enhancements will lead to robust adoption of wearables and smart-connectivity solutions, containing smart speakers and virtual reality/augmented reality (VR/AR) devices.

Moreover, technical progress in the telecommunication sector on enhanced implementation of 5G technology and robust attempts in the direction of modification in Internet infrastructure should act as tailwinds.

Oh, Did We Miss?

Nothing is free. All the things mentioned above come with a price. Security issues, thefts, data breaches, and confidentiality issues have become common household issues. Whether the coming decades will solve it or not remains a question, but the increasing number of lawsuits accumulating reveal that there will be clarity of duties and responsibilities.

Will everything be perfect in the future? We have our doubts, but one thing that we can be sure of is that we’ll make more improvement and progress.

5 Popular Stocks

With a positive outlook for the tech industry, investors might want to add a few tech-focused stocks to their portfolios. We have identified four tech stocks with strong fundamentals that investors might want to consider for 2020.

Telstra Corporation Limited (ASX: TLS)

Telstra Corporation Limited is Australia’s leading technology and telecommunication, which provides a broad range of telecommunication and information services like internet and pay television, and mobiles. The company is developing future for expertise and competencies in products and technologies that comprise the Internet of Things, cloud computing, machine learning and artificial intelligence and big data. Total income for Telstra in FY19 stood at $27.8 billion.

Stock Performance

Telstra Corporation has a market cap of $43.29 billion with ~ 11.89 billion outstanding shares. The company’s stock price closed at $3.540 on 31 December 2019, down by 2.75% relative to the previous close.

The Citadel Group Limited (ASX: CGL)

A software and technology company, the Citadel Group Limited provides secure enterprise information management to boost decisions making process across the Health, National Security, Defence and Other companies. For FY20, the company anticipates an encouraging return to revenue and EBITDA and a low double-digit increase in organic revenue. The company expects FY20 margins to be in accordance with FY19.

The company is dedicated to safeguarding people and secure data. CGL anticipates creating shareholders’ value in the long run. The company expects progress in recurring SaaS and software-based services revenue on the heels of the higher implementation of Citadel 2.0 approach.

Stock Performance

Citadel Group Limited has a market cap of $245.54 million with ~49.31 million outstanding shares. The company’s stock price closed at $4.920 on 31 December 2019, down by 1.2% relative to the previous close.

Appen Limited (ASX: APX)

Founded in 1996, Appen Limited is a supplier and developer of data solutions for artificial intelligence and machine learnings applications. The company has over 180 unique languages with a solid grip in the AI-based data annotation platform in the industry. The company reported revenues of $245.1 million for the half-year ended 30 June 2019, an increase of 60% year over year.

Outlook for FY19:

The company anticipates underlying EBITDA to be in the range of $96 million to $99 million in FY19. Additionally, earnings are expected to gain from higher monthly relevance revenues and increasing margins. The company expects ARR outlook for the same period to be in the range of $30M - $35M (at A$1=US$0.74).

Stock Performance

Appen Limited has a market cap of $2.84 billion with ~ 121.11 million outstanding shares. The company’s stock price closed at $22.460 on 31 December 2019, down by 4.181% relative to the previous close.

Altium Limited (ASX: ALU)

Altium Limited is one of the largest providers of PCB design kits and components. The company also provides data management software and creates next-generation electronic products and systems. Altium’s leading product is known for its skill in 3D Printed Circuit Board (PCB) Computer. For the FY19 (period ended 30 June 2019), the company’s revenues stood at US$171.8 million, up 23% year over year. For FY20, the company expects revenues to be in the range of US$ 205 million – US$ 215 million.

Stock Performance

Altium Limited has a market cap of $4.73 billion with ~ 130.97 million outstanding shares. The company’s stock price closed at $34.72 on 31 December 2019, down by 3.93% relative to the previous close.

Nearmap Ltd (ASX: NEA)

A technology-driven company, Nearmap has provided a platform for frequently reorganised and high-resolution aerial imagery for companies, businesses and governments. The data-based company offers online PhotoMap content for 88%, 65-70% and 70% of the population in Australia, US, and New Zealand, respectively. For FY19 (period ended on 30 June 2019), the company increased its revenue by 45% year over year to $77.6 million.

Outlook

The company aims to execute its growth plans and foresees annualised contract value for the group in the range of $116 million to $120 million for FY20.

Stock Performance

Nearmap has a market cap of $1.19 billion with ~452.46 million outstanding shares. The Nearmap stock price closed at $2.630 on 31 December 2019, down by 3.42% relative to the previous close.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

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