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Best Tech Stocks for February 2024

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These are some of the best tech stocks based on best value, fastest growth, and most momentum

Best Tech Stocks for February 2024

  • GRAVITY Co. Ltd.: A South Korea-based software developer, it focuses on online and mobile game applications. One of its flagship game products is Ragnarok Online. Gravity shares have surged by more than 40% in the last year.
  • Open Text Corp.: A developer of enterprise information management software based in Canada. Open Text offers customer experience management, discovery, artificial intelligence solutions, and more. The company recently announced the launch of its Cloud Editions 24.1 product, including numerous AI integrations.4
  • Nubeva Technologies Ltd.: This firm provides decryption software and related services. Nubeva serves business and government clients as well as organizations.

Tech Stocks With the Most Momentum

Momentum investing is a strategy aiming to capitalize on pre-existing market trends by focusing on stocks that have outpaced their peers or the broader market on returns. This investment principal holds that stocks on an upward path are likely to continue to outperform so long as fundamental aspects of the business, industry, or sector do not change.

Best Tech Stocks for February 2024

Momentum investing is a common strategy applied to tech stocks because they regularly experience significant market disruptions. As companies launch new products, announce technological breakthroughs, and gain rapid popularity, investors have the potential to climb on board while these stocks are still ascending.

Here are the tech stocks with the highest total return in the last 12 months. We’ve excluded stocks with a share price of under a dollar.

Tech Stocks With the Most Momentum
  • Fang Holdings Ltd.: A China-based tech firm operating an online real estate portal. Fang provides marketing, listing, leads generation and financial services for real estate and home improvement markets in China.
  • AppLovin Corp.: This is a game developer and mobile analytics, marketing, and development platform provider. AppLovin operates the platforms Lion Studios, SparkLabs, and AppDiscovery, among others. In its third quarter 2023 report, AppLovin announced 21% YOY improvement in revenue and $109 million in net income, driven by its AXON 2.0 AI-based advertising engine.5
  • Crexendo Inc.: A firm providing telecommunications services, broadband Internet services, and other cloud business services, including software licensing and maintenance support. The company announced in January that it had a user surge of 36% for 2023, about double the industry average.6

Advantages of Tech Stocks

Growth potential

Tech stocks, particularly those in emerging areas, are known for experiencing some of the sharpest growth of any publicly traded company. Anticipating this, investors have sought periods in which the sector underperforms to invest heavily, as they expect significant growth over the long term.

But growth among tech stocks can vary dramatically. Many of the larger firms have limited growth potential because their market saturation and capitalization are already very high. Small-cap or penny tech stocks that experience technological breakthroughs or suddenly become incredibly popular may have periods of massive growth. Unusually, some of the biggest names in tech—including Amazon.com Inc. (AMZN), Meta Platforms Inc. (META), and Alphabet Inc. (GOOGL)—have continued to grow at significant rates.

Advanced innovation

Tech trends are always changing, with companies aiming to capitalize on the latest technology and to guide and follow developments in innovation. This makes the sector primed for breakthroughs. One of the most recent major trends to sweep the tech sector has been AI-related technologies, which are increasingly integrated into companies across many industries and sectors. To the extent that some tech companies continue to play a role in making this possible, they stand to benefit from the ongoing AI trend.

Disadvantages of Tech Stocks

Fluctuations in the tech sector

While it can be tempting to imagine that the tech sector only moves upward, this is not the reality. For example, 2022 was generally viewed as a very poor year for the sector. Even the largest firms faced significant downturns. Alphabet dropped by 39% in that year, for instance.7

One reason for the sector’s occasional stumbles is often related to the supply chain. When there are disruptions to the supply of materials and equipment necessary to make the highly specialized components used by tech companies, this can throw off an entire industry. A multi-year shortage of semiconductor components recently disrupted a range of industries, for example.8

Trends shift quickly

The sharp gains of many tech firms can prove tempting to investors who may not be well-versed in the technologies themselves. With rapid innovation characterizing the sector, trends and prospects shift very quickly as well. Investors who are unprepared for this pace or who lack knowledge of the fundamental strengths of different tech companies may find themselves following a trend that has already changed.

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