The tech market’s valuations fell earlier this year as investors worried about the Federal Reserve’s expected tightening of monetary policy. However, this reaction could be beneficial to the sector’s long-term growth. The market made a comeback last week after tech stocks led a rally from 11-month lows. Wall Street analysts expect the hard-hit tech stocks NVIDIA (NVDA), RingCentral (RNG), and Wix.com (WIX) to rally by 50% or more in price as a result of this movement. Continue reading.

Following a pandemic-driven boom, the tech market saw a sharp correction in valuations in the first weeks of this year, as inflation reached historic highs and the Federal Reserve signaled an increase in benchmark interest rates. This, on the other hand, is expected to be beneficial to the market’s long-term health. A shift in investor sentiment, according to analysts, could be a sign of a healthy long-term cycle.

In the midst of the Russia-Ukraine conflict, the stock market staged a stunning comeback thanks to a sharp rebound in tech stocks, which had fallen to 11-month lows, as the Biden administration announced export restrictions against Russia but did not ban the country’s use of the SWIFT International Payment system, seemingly putting investors’ fears to rest.

In light of this, Wall Street expects the hard-hit tech stocks NVIDIA Corporation (NVDA), RingCentral, Inc. (RNG), and Wix.com Ltd. (WIX) to rally by 50% or more in the near term.

NVIDIA Corporation (NVDA)

NVDA is a visual computing company based in Santa Clara, California, that operates in the Graphics and Compute & Networking segments globally. GeForce GPUs for gaming and PCs, GeForce NOW Gaming Streaming devices, and Data Center platforms and systems for AI are all available from the company. It has a $582.88 billion market capitalization.

Jaguar Land Rover and NVDA announced a multi-year strategic partnership on February 16 to jointly develop and deliver next-generation automated driving systems as well as AI-enabled services and experiences for Jaguar Land Rover customers. This partnership should be beneficial to NVDA.

On January 4, NVDA unveiled over 160 gaming and Studio GeForce®-based laptop designs, as well as new GeForce RTX® GPUs and technologies for desktop and laptops. The company’s revenue stream may be boosted by the new products and designs.

NVDA’s revenue increased 52.8 percent year over year to $7.64 billion in the fiscal fourth quarter ended January 30. Its non-GAAP income from operations increased by 76 percent to $3.68 billion from the previous quarter. Its non-GAAP net income and non-GAAP net income per share increased by 71.2 percent and 69.2%, respectively, from the same period the previous year to $3.35 billion and $1.32 billion.

Analysts expect NVDA’s EPS to increase 41.8 percent year over year to $1.29 for the fiscal quarter ending April 30, 2022, while revenue is expected to increase 43.3 percent to $8.11 billion. Furthermore, NVDA has a strong track record of outperforming consensus earnings estimates, having done so in each of the previous four quarters.

The stock has gained 69.6% in the last year, but has lost 20.2 percent year to date, closing at $234.77 in yesterday’s trading session.

Nineteen Wall Street analysts have given NVDA a Buy rating, while three have given it a Hold rating. The 12-month median price target of $362.22 indicates a potential upside of 54.3 percent. The price ranges from $250.00 to $400.00 for the price targets.

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RingCentral, Inc. (RNG)

RNG is a Software-as-a-Service solutions provider based in San Mateo, California, that enables businesses to communicate, collaborate, and connect. RingCentral Office, communication and collaboration provider across multiple modes, and RingCentral Contact Center, a collaborative contact center solution, are two of the company’s products.

RNG launched two new products on March 1 to meet the current and evolving demands in education. RingCentral Education EssentialsTM and RingCentral Education StandardTM are designed to provide flexible solutions for virtual, hybrid, and on-campus classrooms. Both solutions are expected to be available by the end of March, and they could potentially boost the company’s revenue.

On February 17, Deutsche Telekom, a German national network and service provider, and RNG announced the expansion of their partnership to provide customers with RingCentral X powered by Telekom, an end-to-end communication and collaboration solution. By leveraging Deutsche Telekom’s high-quality access products and strong brand presence, the solution should benefit RNG.

In the fiscal fourth quarter, which ended December 31, RNG’s total revenues increased 34.1 percent year over year to $448.50 million. Its gross profit increased by 28.4% to $312.48 million from the previous quarter. The company’s non-GAAP net income and non-GAAP net income per share were $36.64 million and $0.39, respectively, up 37.2 percent and 34.5 percent from the previous year.

For the quarter ending March 31, 2022, the $0.34 consensus EPS estimate represents a 25.9% year-over-year increase. In addition, the $458.67 million consensus revenue estimate for the same quarter represents a 34.9 percent increase over the prior-year quarter. RNG has also outperformed consensus EPS estimates in each of the last four quarters.

The stock has dropped 32.8 percent in price year to date but has gained 1.3 percent in the last five days, closing at $125.83 yesterday.

Twenty-one analysts have given RNG a Buy rating, while three have given it a Hold rating. The median 12-month price target of $236.14 indicates a potential upside of 87.7%. The price targets range from $165.00 to $300.00, with a low of $165.00 and a high of $300.00.

Wix.com Ltd. (WIX)

WIX, based in Tel Aviv, Israel, is a developer and marketer of a cloud-based platform that allows anyone in the world to create a website or web application. Wix Editor, Wix ADI, Corvid by Wix, Ascend by Wix, and Wix Logo Maker are some of the company’s products.

Yellow Pages Limited, a Canadian digital media and marketing firm, announced on February 10 that it has formed a strategic partnership with WIX to expand its website offering. Deepcrawl, a technical SEO and website health SaaS platform, and WIX announced a partnership on January 13 to allow WIX users to use Deepcrawl’s SEO technology. Both of these collaborations could be beneficial to the company.

PayPal Holdings Inc. (PYPL) announced on December 1 that WIX merchants would be able to offer PYPL’s PayPal Credit and PayPal Pay in 4 services. “By continuing to offer flexible payment methods to our merchants like PayPal Credit and PayPal Pay in 4, we’re helping merchants reach more customers by providing them with more options at checkout and ultimately increasing their conversion,” said Amit Sagiv, WIX’s Co-Head of Payments.

WIX’s revenue increased 16.2 percent year over year to $328.34 million in its fiscal fourth quarter, which ended December 31. This can be attributed to a 15.4 percent increase in creative subscriptions revenue to $246.67 million from the previous quarter. Its gross profit increased by 11.3 percent to $199.54 million from the same period the previous year.

The Street’s EPS forecast for fiscal 2023 is up 62.1 percent year over year, while revenue forecasts for the same year are up 17.2 percent year over year at $1.72 billion. In each of the last four quarters, WIX has outperformed consensus EPS estimates.

WIX’s stock has dropped 45.7 percent year to date, closing at $85.71 in yesterday’s trading session. Over the last five days, it has gained 5.1 percent in value.

Ten Wall Street analysts have given WIX a Buy rating, while five have given it a Hold rating. The 12-month median price target of $137.50 indicates a potential upside of 60.4 percent. The price ranges from $85.00 to $250.00 for the price targets.

On Wednesday afternoon, NVDA shares were trading at $243.35 per share, up to $8.58 (+3.65%). NVDA has dropped -17.26 percent year to date, compared to a -7.71 percent rise in the benchmark S&P 500 index.