Looking for stock picks in 2024? These three tech stocks could bring the best returns.
This year has had its shares of ups and downs for tech investors. Some of the biggest gainers of 2023 have been tech stocks, but there have also been plenty of laggards. It's never too early to start looking for the names that will lead the market in the coming year, and you don't need a lot of money to get going.
CrowdStrike(NASDAQ: CRWD), Twilio (NYSE: TWLO), and Microsoft (NASDAQ: MSFT) are three stocks that have strong catalysts heading into 2024 for your next $3,000 investment. Let's take a closer look.
CrowdStrike
A list of the top tech stocks of 2023 wouldn't be complete without CrowdStrike. The stock hit another all-time high in late November, and the cybersecurity specialist has doubled in value this year. The shares will be on the move one way or the other.
CrowdStrike earned its upticks this year. The leading provider of cloud-based security solutions for enterprises with its popular Falcon platform has delivered consistent "beat and raise" performances, and the story seems to keep getting better with every passing financial update.
CrowdStrike exceeded analyst profit targets by 9% three quarters ago, 12% two quarters ago, and a whopping 32% last time out. It also finally broke out to be profitable on a reported basis, in the black in back-to-back reports to kick off fiscal 2024. Revenue growth has slowed, but scalability has made it a powerhouse with a loyal and growing customer base. It's a winner that should keep winning.
Twilio
Compared to CrowdStrike's, Twilio's year-to-date gain in November of 28% seems uninspiring. The stock was also nowhere close to hitting an all-time high, at 86% below the peak it established in early 2021. Twilio provides in-app communications solutions to more than 304,000 active developers. When you get a notification on your phone -- for anything from a delivery driver's arrival to a password reset -- without having to leave an app, that could be Twilio in action.
You don't have to look hard to find a reason for Twilio trading substantially lower than the all-time high it hit roughly 33 months ago. Revenue has decelerated sharply for nine consecutive quarters, a stretch that started with 67% year-over-year growth and fell to a mere 5% increase in a recent update.
The news has been substantially better on the bottom line. Twilio's adjusted earnings more than doubled in its latest report, and it sees the same thing happening in the current quarter. Revenue is expected to decelerate again -- Twilio sees a 1% to 2% increase for the new quarter -- but cost controls are encouraging investors until the headwinds turn into tailwinds on the top line.
Microsoft
Let's close on a less speculative tech stock. Microsoft commands the country's second-largest market cap, and if it keeps closing the gap with the class act of Cupertino it may be the most valuable U.S.-listed stock at some point in 2024. Microsoft regaining the market-cap crown shouldn't surprise anyone given the software giant's improving narrative.
Microsoft is a leader in artificial intelligence through its stake in ChatGPT parent OpenAI. Microsoft's Azure is gaining market share in hosting the cloud computing revolution. It also finally successfully closed on its acquisition of Activision Blizzard, making the Xbox company an even bigger force in gaming. The blue chip may not seem cheap at 37 times trailing earnings, but Microsoft has earned its right to a market premium.
Rick Munarriz has positions in CrowdStrike. The Motley Fool has positions in and recommends CrowdStrike, Microsoft, and Twilio. The Motley Fool has a disclosure policy.
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