The technology sector was a standout for the first nine months of the year, gaining a staggering 34% in September alone. However, an industry-wide that started on Sept. 3 continues to impact current levels, bringing the tech-heavy index trading 10.16% below its all-time high it hit last week.
Despite the current downturn, there are more than a few attractive names in the group enjoying accelerated profit and revenue growth due to the booming demand for cloud-based offerings during the COVID-19 pandemic.
Here are three bargains to consider as the industry sell-off continues:
Cloudera (NYSE 🙂 stock is on the rise has been known since it fell to a bear market low of $ 4.76 on March 18. At one point, shares of the Palo Alto, California-based data company were up nearly 200%, but the general sell-off in technology knocked some of the wind out of the high-flyer's sails.
Stocks – which closed at $ 10.89 on Tuesday – are about 22% below their recent 52-week high of $ 14.10, reached Sept. 2, despite last week's results and forecast.
Cloudera posted earnings per share of $ 0.10 for the three months ended July 31, compared to a loss of $ 0.02 per share in the same quarter a year earlier. Consensus estimates called for earnings per share of $ 0.07. Revenues, meanwhile, were up 9% year-on-year to $ 214.34 million, driven by a surge in demand for its Cloudera Data Platform Private Cloud services as the COVID-19 pandemic accelerated digitization trends for enterprises.
"We reached an important milestone last month with the general availability of Cloudera Data Platform Private Cloud, significantly enhancing our Enterprise Data Cloud strategy," said CEO Rob Bearden in the earnings summary.
Total subscription revenue was up 17% from the same period last year to $ 191.5 million, while annual recurring revenue (ARR) was up 12% yoy to $ 739 million.
At the end of the second quarter, Cloudera had 1,007 customers who exceeded $ 100,000 in ARR, while 172 customers had an ARR of more than $ 1 million.
For the current quarter, Cloudera forecasts revenue of $ 207 million to $ 210 million, above consensus estimates requiring revenue of $ 205.30. Tax guidance for 2021 has also been given a lift. Previously, Cloudera expected revenues between $ 825 million and $ 845 million, but now projects are estimated at $ 853 million.
Fastly (NYSE :), which helps other companies speed up their websites, apps, video and streaming offerings on mobile devices, has recently experienced some turbulence.
After enjoying massive gains of a staggering 487% through early August, the stock – which ended yesterday at $ 81.08 – is now about 31% below the record $ 117.79 reached on August 5 . Consensus estimates of online content delivery network specialists' revenues and revenues for the second quarter of last month.
The San Francisco-based company, which went public in May 2019, reported earnings of $ 0.02 per share in the three months ended June 30, improving dramatically from a loss of $ 0.16 per share in the same quarter a year earlier. Analysts expected a loss per share of $ 0.01 on average.
Revenues were up nearly 62% from the same period last year to $ 74.66 million, due to the rapid adoption of the services as more people work from home.
The cloud computing company said that the total number of customers increased by 114 in the second quarter to 1,951, the largest quarterly growth since its IPO in mid-2019.
"Our strong fundamentals have led to continuous expansion of the number of customers on our platform, supported by increased traffic levels on the Internet while keeping people at home," Fastly said in its earnings review.
Looking ahead, the company forecasts third-quarter revenue of $ 74.5 million mid-term expectations, almost unchanged from the second quarter, due to concerns about what a potential TikTok ban in the US could mean for the US. top of the company. bottom line.
CNBC reported that "Joshua Bixby, Fastly's CEO, said on his company's earnings call that TikTok is the largest customer, accounting for about 12% of sales in the first six months of the year." The Trump administration has threatened to ban TikTok over data privacy concerns.
But for the full year, Fastly raised its 2020 revenue forecast to a range of $ 290 million to $ 300 million, up from the previous expectation of $ 280 million to $ 290 million.
Cloudflare (NYSE 🙂 ignited the market for the first eight months of the year, before suddenly losing momentum in early September . Shares of the cloud networking and security solutions provider are up 93% in 2020, even after a recent downturn that cut YTD earnings by as much as 165%.
The stock – which settled at $ 32.94 last night – is currently trading about 27% below its all-time high of $ 45.28 reached on August 7, despite reporting revenues and earnings set in the second quarter. are being displayed.
The San Francisco-based company, which released results on August 6, showed it lost $ 0.03 per share, compared to a loss of $ 0.07 per share in the same period a year ago. Revenue rose to $ 99.72 million for the period ended June 30, an impressive 48% from the same quarter a year earlier, as it benefited from strong demand for its cybersecurity services and cloud-based networks due to the spike in internet traffic.
"We delivered a strong second quarter, with sales up 48% year-on-year, adding a record number of large and paying customers," said Chief Executive Matthew Prince in the company's press release.
The paying user base of the network security company increased 24% from the same period last year to 96,178. More impressively, major customers who spend at least $ 100,000 annually were up 65% from Q2 2019.
Looking ahead, Cloudflare sees revenues increase to a range of $ 102.5 to $ 103.5 million in the third quarter ending September, indicating sales growth of 39% to 40%.