Three (3) Tech Upgrades That Defy The Correction

Three Tech Stocks To Buy On The Dip

The long-awaited market correction may be at hand and that means it's time for long-term oriented investors to start scooping up high-yield and values and where they can find them. While many stocks are moving lower on the growing fear of a global economic slowdown, some stocks are still well-positioned for the current environment. These stocks are getting the attention of analysts and, in some cases, are resulting in double upgrades and significant price target increases. Price action in these stocks may come under pressure in the near term but they should outperform on the rebound and deliver real value for their investors.

Adobe Is A Crown Jewel Of Software

Wells Fargo didn't upgrade Adobe NASDAQ: ADBE but it did initiate coverage of the stock in a significant way. Wells Fargo initiated Adobe at Overweight with a $770 price target calling it a crown jewel among software companies. Not only is the company well-positioned in today's environment but its outlook for long-term growth is robust. Wells Fargo is expecting a moderately high double-digit EPS expansion for the next several years that should help drive the shares higher. The $770 price target is the Wall Street high and compares to the consensus target of $658. The consensus target assumes the stock is fairly valued at current price levels but has been trending higher. 

Data from Marketbeat.com shows the consensus target is up 8.5% over the past two months and will likely move higher over the next 2 months if what we're seeing is right. The company has been able to sustain high levels of growth in the wake of the pandemic and shows no sign of letting up. Digital was quickly becoming King before the pandemic and is now firmly enthroned as a driving force of our economy. Shares of Adobe are moving lower in early action but have yet to break the uptrend. If the trend is broken at the short-term moving average, we would expect to see firm support kick in around the $625 level.

Analog Devices Is Riding A Wave Of Positive Sentiment

Analog Devices NASDAQ: ADI has seen a steady stream of upgrades, price target hikes, and new coverage over the past two months that is not ending. The latest comes from JPMorgan which gave the stock a double upgrade to Overweight and set the Wall Street high price target of $215. This compares to the consensus sentiment of a Buy bordering Strong Buy and price target of $183. The consensus price target of $183 is up nearly 10% over the last two months and is leading price action by 7%. 

Notably, the consensus of the 10 most recent analysts is just shy of $192. Based on the market for semiconductors, our expectations for revenue and earnings in the sector, and the analyst activity we expect to see the consensus price target continue to edge higher and for Analog Devices to set a new all-time high before the end of the year. If price action that doesn't find firm support at the $168 level we see the $164 level as the next firm target.

Salesforce.com Is A Force To Be Reckoned With 

Wells Fargo also called out Salesforce.com (NYSE: CRM) labeling it an underappreciated growth story. We don't know that it's an underappreciated growth story so much that the growth potential of this company has yet to be truly quantified. As the leader in CRM services worldwide, the company is growing by leaps and bounds and will likely dominate the market long into the future. 

Wells-Fargo initiated the stock at overweight with a price target of $325 which compares to the consensus rating of Buy/Strong Buy and price target of $301.  Salesforce.com, more than any other stock on this list, has seen an influx of new coverage that is helping to support the price action as well. The stock has seen 8 new ratings and/or price targets issued over the past two months that have helped push price action up to near all-time high levels. We expect to see this trend continue and for the stock to set a new all-time high by the end of the year.