News

We provide the latest news
from the world of economics and finance

10 July
Validea's Top Information Technology Stocks Based On Warren Buffett - 7/10/2024

The following are the top rated Information Technology stocks according to Validea's Patient Investor model based on the published strategy of Warren Buffett. This strategy seeks out firms with long-term, predictable profitability and low debt that trade at reasonable valuations.

ACCENTURE PLC (ACN) is a large-cap growth stock in the Computer Services industry. The rating according to our strategy based on Warren Buffett is 92% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Accenture plc is a global professional services company. The Company is engaged in providing a range of services and solutions across strategy and consulting, technology, operations, Industry X and Accenture Song. Its services include application services, artificial intelligence, automation, business process outsourcing, business strategy, change management, cloud, customer experience, data and analytics, ecosystem partners, finance consulting, Industry X, infrastructure, marketing, operating models, security, supply chain management, technology consulting, technology innovation and zero-based budgeting (ZBB). It specializes in the SAP business technology platform that designs digital products and experiences for enterprise customers, including custom portals and Web solutions and mobile applications. It is also engaged in providing clients with quantitative and qualitative risk management and compliance services. It also specializes in advisory, management services and cybersecurity.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS PREDICTABILITY:PASS
DEBT SERVICE:PASS
RETURN ON EQUITY:PASS
RETURN ON TOTAL CAPITAL:PASS
FREE CASH FLOW:PASS
USE OF RETAINED EARNINGS:PASS
SHARE REPURCHASE:NEUTRAL
INITIAL RATE OF RETURN:PASS
EXPECTED RETURN:PASS

Detailed Analysis of ACCENTURE PLC

ACN Guru Analysis

ACN Fundamental Analysis

ASML HOLDING NV (ADR) (ASML) is a large-cap growth stock in the Semiconductors industry. The rating according to our strategy based on Warren Buffett is 86% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: ASML Holding N.V. is a holding company based in the Netherlands. The Company operates through its subsidiaries in the Netherlands, the United States, Italy, France, Germany, the United Kingdom, Ireland, Belgium, South Korea, Taiwan, Singapore, China, Hong Kong, Japan, Malaysia and Israel. The Company operates through one business segment which is engage in development, production, marketing, sales, upgrading and servicing of advanced semiconductor equipment systems, consisting of lithography, metrology and inspection systems. The Company offers TWINSCAN systems, equipped with lithography system with a mercury lamp as light source (i-line), Krypton Fluoride (KrF) and Argon Fluoride (ArF) light sources for processing wafers for manufacturing environments for which imaging at a small resolution is required. TWINSCAN systems also include immersion lithography systems (TWINSCAN immersion systems).

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS PREDICTABILITY:PASS
DEBT SERVICE:PASS
RETURN ON EQUITY:PASS
RETURN ON TOTAL CAPITAL:PASS
FREE CASH FLOW:PASS
USE OF RETAINED EARNINGS:PASS
SHARE REPURCHASE:PASS
INITIAL RATE OF RETURN:FAIL
EXPECTED RETURN:PASS

Detailed Analysis of ASML HOLDING NV (ADR)

ASML Guru Analysis

ASML Fundamental Analysis

MICROSOFT CORP (MSFT) is a large-cap growth stock in the Software & Programming industry. The rating according to our strategy based on Warren Buffett is 86% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Microsoft Corporation is a technology company. The Company develops and supports software, services, devices, and solutions. The Company's segments include Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The Productivity and Business Processes segment consists of products and services in its portfolio of productivity, communication, and information services. This segment primarily comprises: Office Commercial, Office Consumer, LinkedIn, and Dynamics business solutions. The Intelligent Cloud segment consists of server products and cloud services, including Azure and other cloud services, SQL Server, Windows Server, Visual Studio, System Center, and related Client Access Licenses (CALs), and Nuance and GitHub; and Enterprise Services, including enterprise support services, industry solutions and Nuance professional services. The More Personal Computing segment primarily comprises Windows, devices, gaming, and search and news advertising.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS PREDICTABILITY:PASS
DEBT SERVICE:PASS
RETURN ON EQUITY:PASS
RETURN ON TOTAL CAPITAL:PASS
FREE CASH FLOW:PASS
USE OF RETAINED EARNINGS:PASS
SHARE REPURCHASE:PASS
INITIAL RATE OF RETURN:FAIL
EXPECTED RETURN:PASS

Detailed Analysis of MICROSOFT CORP

MSFT Guru Analysis

MSFT Fundamental Analysis

KLA CORP (KLAC) is a large-cap growth stock in the Semiconductors industry. The rating according to our strategy based on Warren Buffett is 82% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: KLA Corporation is a supplier of process control and yield management solutions and services for the semiconductor and related electronics industries. The Company offers a portfolio of inspection and metrology products, and related services, software and other offerings, supports research and development (R&D) and manufacturing of integrated circuits (ICs), wafers and reticles. Its segments include Semiconductor Process Control, Specialty Semiconductor Process and PCB, Display and Component Inspection. Semiconductor Process Control segment provides comprehensive portfolio of inspection, metrology and software products, and related services, helping IC, wafer, reticle/mask and chemical/materials manufacturers achieve target yields throughout the entire fabrication process, from R&D to final volume production. The Specialty Semiconductor Process segment develops and sells advanced vacuum deposition and etch process tools, which are used by a range of specialty semiconductor customers.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS PREDICTABILITY:PASS
DEBT SERVICE:PASS
RETURN ON EQUITY:PASS
RETURN ON TOTAL CAPITAL:PASS
FREE CASH FLOW:PASS
USE OF RETAINED EARNINGS:PASS
SHARE REPURCHASE:PASS
INITIAL RATE OF RETURN:FAIL
EXPECTED RETURN:PASS

Detailed Analysis of KLA CORP

KLAC Guru Analysis

KLAC Fundamental Analysis

TEXAS INSTRUMENTS INC (TXN) is a large-cap growth stock in the Semiconductors industry. The rating according to our strategy based on Warren Buffett is 61% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Texas Instruments Incorporated is a global semiconductor company. The Company designs, manufactures, tests, and sells analog and embedded processing chips for markets, such as industrial, automotive, personal electronics, communications equipment, and enterprise systems. The Company's segments include Analog and Embedded Processing. The Analog segment includes product lines, such as Power and Signal Chain. Power includes products that help customers manage power in electronic systems. Signal Chain includes products that sense, condition, and measure real-world signals to allow information to be transferred or converted for further processing and control. The Embedded Processing segment includes microcontrollers, digital signal processors (DSPs) and applications processors. The Company also offers DLP products (primarily used to project high-definition images), calculators and certain custom semiconductors known as application-specific integrated circuits (ASICs).

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS PREDICTABILITY:PASS
DEBT SERVICE:PASS
RETURN ON EQUITY:PASS
RETURN ON TOTAL CAPITAL:PASS
FREE CASH FLOW:FAIL
USE OF RETAINED EARNINGS:PASS
SHARE REPURCHASE:PASS

Detailed Analysis of TEXAS INSTRUMENTS INC

TXN Guru Analysis

TXN Fundamental Analysis

Warren Buffett Portfolio

Top Warren Buffett Stocks

About Warren Buffett: Warren Buffett is considered by many to be the greatest investor of all time. As the chairman of Berkshire Hathaway, Buffett has consistently outperformed the S&P 500 for decades, and in the process has become one of the world's richest men. (Forbes puts his net worth at $37 billion.) Despite his fortune, Buffett is known for living a modest lifestyle, by billionaire standards. His primary residence remains the gray stucco Nebraska home he purchased for $31,500 nearly 50 years ago, according to Forbes, and his folksy Midwestern manner and penchant for simple pleasures -- a cherry Coke, a good burger, and a good book are all near the top of the list -- have been well-documented.

About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.