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Is TTEC Holdings, Inc. (TTEC) the Best Oversold Tech Stock to Buy Right Now?
We recently compiled a list of the 10 Oversold Tech Stocks To Buy Right Now.In this article, we are going to take a look at where TTEC Holdings, Inc. (NASDAQ:TTEC) stands against the other oversold tech stocks.
In an interview with CNBC on September 30, Dave Sekera, Chief Market Strategist at Morningstar, shared his insights on the current state of the technology sector and the broader market. According to Sekera, the technology sector as a whole is "priced to perfection" and is trading at a 6% premium to fair value.
However, Sekera believes several technology stocks have run up too far trading at over 20% premium to fair value, whereas their sales have been sluggish. Sekera advises taking profits off the table for companies who are trading at a premium to fair value. Sekera's team is also concerned that the market is overestimating the long-term growth potential of some companies due to artificial intelligence (AI), however, he believes that some of these companies will not benefit enough from AI to justify their current valuation. Sekera recommends four-star rated stocks that are trading at a discount to fair value and suggests swapping out overvalued companies and overextended AI stocks for these companies. Sekera also discussed the broader market, noting that growth stocks have outperformed value stocks for a while. However, he believes that it's time to look at small-cap and mid-cap value-oriented names and believes that these types of value stocks are due for a rotation.
Sekera notes that the overall US market is currently trading at a 3% premium to fair value. He believes that this rotation into value stocks and small-cap stocks will be driven by the expectation of slowing economic growth in the US and the easing of monetary policy by the Federal Reserve. Historically, small-cap stocks have performed well in these conditions, and value stocks have been left behind in the frenzy to buy AI-related stocks. Sekera expects value stocks to catch up, and he believes that now is a good time to invest in these undervalued stocks.
With the Fed's dovish stance and the potential for further rate cuts, tech stocks may continue to be a safe haven for investors, with that in context, let’s take a look at the 10 oversold tech stocks to buy right now.
Our Methodology
To compile our list of the 10 oversold tech stocks to buy right now, we used the Finviz and Yahoo stock screeners to find stocks that have fallen significantly on a YTD basis and have a forward P/E of less than 15, as of October 15. We then narrowed our choices to 10 stocks according to their hedge fund sentiment, which was taken from our database of 912 elite hedge funds as of Q2 of 2024. The list is sorted in ascending order of their hedge fund sentiment, as of the second quarter.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 smallcap and largecap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A business executive reviewing customer analytics on their laptop in a modern office.
TTEC Holdings, Inc. (NASDAQ:TTEC) provides customer experience solutions and services through the business process outsourcing (BPO) model. The company partners with firms to manage customer interactions across multiple channels.
TTEC Holdings, Inc. (NASDAQ:TTEC) offers a range of services including digital transformation, customer engagement, and technology innovation. The company's services are designed to help clients improve their customer relationships, enhance their brand reputation, and increase their revenue growth.
TTEC Holdings, Inc. (NASDAQ:TTEC) operates through two synergistic business segments, TTEC Digital and TTEC Engage, which complement each other and create a holistic approach to customer experience (CX) management. TTEC Digital provides cutting-edge technology solutions such as cloud-based contact center-as-a-service (CCaaS), AI, and CRM platforms, while TTEC Engage specializes in delivering customer experience (CX) services. This blend of digital transformation technology and operational CX services makes TTEC Holdings, Inc. (NASDAQ:TTEC) well-positioned to capitalize on a massive and expanding total addressable market (TAM) valued at approximately $640 billion as of 2020.
TTEC Holdings, Inc. (NASDAQ:TTEC) has also expanded its artificial intelligence (AI) offerings by integrating the latest advancements in generative AI into its CX solutions. This combination allows the company to offer clients immediate AI-driven CX solutions and leverage AI to enhance customer interactions. TTEC Holdings, Inc.'s (NASDAQ:TTEC) innovative and service offerings differentiate it in the competitive CX market and can potentially lead to improved market share and revenue growth. Industry analysts have a consensus Buy rating on the stock, with a target price of $6.09, indicating a potential gain of 10.54% from its current price.
Overall TTEC ranks 7th on our list of the oversold tech stocks to buy. While we acknowledge the potential of TTEC as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TTEC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
