Top Rated Tech Stocks Based on Benjamin Graham's Strategy

Evaluating top-rated tech stocks reveals important insights for investors. Notably, Axcelis Technologies, ON Semiconductor, Photronics, and Vishay Intertechnology show varying metrics, particularly in EPS growth and valuation scores, impacting investor strategies.

Date: 02-05-2025

AI Rating: 7

In the current report, Axcelis Technologies Inc. (ACLS) and ON Semiconductor Corp (ON) emerge as high-rated stocks within the technology sector, specifically under the semiconductors industry. Both companies have received a rating of 86%, which indicates robustness in their respective fundamentals and valuations according to Benjamin Graham's value-investing principles.

Earnings Per Share (EPS) Growth: For both ACLS and ON, the report indicates that they passed the long-term EPS growth test, a critical parameter for investors seeking companies with sustainable profit potential. This positive movement in EPS can lead to enhanced investor confidence, driving stock prices higher in the near term.

Photronics Inc. (PLAB) and Vishay Intertechnology Inc. (VSH), while rated lower at 71%, still exhibit solid metrics with profitability ratios meeting screening expectations. However, they each have specific flags, particularly with Photronics failing the sales metric, which should be a caution signal for potential investors.

Valuation Ratios: The P/E ratio and Price/Book Ratio trends remain favorable across these stocks, particularly that a lower P/E ratio generally suggests that the stock is undervalued. A strong price/book ratio implies that the market has high expectations of further financial performance, underpinning current stock prices.

Net Income and Profit Margins: While the report does not mention specific net income figures, the emphasis placed on EPS growth suggests underlying profitability could be ascending, indicating potential expansion in profit margins if current trends hold. Companies demonstrating consistent trends in net income in relation to rising sales or stable operating expenses may potentially see stock price increases shortly.

Overall, the ratings indicate positive sentiment towards these stocks, particularly for investors looking for value plays within the technology sector amidst a competitive landscape. Strategic buying of ACLS and ON may be warranted given their grading, while PLAB and VSH require further analysis due to their respective risks.

Stocks: ACLS ON PLAB VSH