After the boom in the technology sector in the first half of the year, many are wondering what potential new opportunities on the stock market could be.
To carry out an adequate screening service, it could be useful to ask yourself: what could be the stock category most deserving of attention in this second half of the year? The answer to this question is not obvious.
However, given the interest of central banks in many developed countries to reduce rates, attention may be directed towards segments currently burdened by excessive financing costs, but with positive business activity. Essentially, companies with positive growth expectations, with cash flows driven by the cost of capital rather than the actual business.
Among these, some small and medium capitalization companies appear to emerge with a counter-intuitive graphic trend compared to the fundamentals.
1. Bio-Techne (TECH), the future in biotechnology
Bio-Techne Corporation, with the rather counterintuitive ticker TECH, is a global biotechnology company specializing in the development, manufacturing, and sale of products and services for scientific and clinical research. It reached its peak following the outbreak of the global pandemic in 2020, benefiting from a strong influx of investment and increased market interest in innovative healthcare solutions.
After reaching highs in 2021, the stock experienced three years of significant downtrend, until October 2023, when it appears to have reached a low level, corresponding to the low prices of 2020, around $60. From that point, TECH stock recorded a 40% increase in the stock market, once again capturing the interest of investors. With a P/E ratio of 62 and an operating margin of 23%, TECH becomes a very risky but attractive solution for lovers of speculation.
- TECH, 1W
- Source: Baha.com
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This stock will rise 40% (according to UBS)
2. Match Group (MTCH), the company behind Tinder
Match Group, Inc., under the ticker MTCH, is an American company specializing in the development and management of online dating platforms. It is considered a global leader in the digital dating industry, owning and operating a wide range of dating apps and websites.
Not surprisingly, it’s the development company behind the eclectic Tinder, one of the most popular dating apps in the world. Although the "blind dating" market, although relatively new, seems very attractive, the company does not seem to be attracting the same interest on the stock market, and compared to the 2021 highs, the shares have lost almost 90% of its value, leaving its investors literally with a match in their hands.
MTCH is part of that category of investments that did well during COVID-19 and were literally forgotten with the slow scaling back of pandemic restrictions. Match has a P/E of 15 and an operating margin of 21%. The stock is literally in free fall, undermined by the downsizing of the company’s business compared to the highs of 2020: this however makes the relevant investment very risky.
- MTCH, 1D
- Source: Baha.com
Original article published on Money.it Italy 2024-06-09 11:50:00. Original title: 2 titoli small-cap da monitorare con attenzione
