Polycom Inc (NASDAQ:PLCM) — Investments in product offerings might well be catlysts
Polycom Inc (NASDAQ:PLCM), a producer of voice and video communications solutions such as telepresence-related products, has struggled a bit of late partly due to soft spending from the public sector. Still, sequential improvements in share profits are apt to resume as new product lines take hold. Specifically, demand for new group (including telepresence, video and voice) product launches is healthy. Polycom Inc (NASDAQ:PLCM)’s CloudAXIS suite video conferencing and collaboration software is being received well, for instance, and related sales should ramp up later this year.
Polycom Inc (NASDAQ:PLCM) will probably still be up against softness in public sector outlays. However, it should be better situated within its key product markets. In the past, Polycom Inc (NASDAQ:PLCM) has been challenged by excess operating costs, as it spends to maintain its competitive position. It competes with the likes of Cisco Systems, Inc. (NASDAQ:CSCO), the networking giant, in telepresence.
In all, Polycom Inc (NASDAQ:PLCM) shares are a bit more of a risk than the previous two. If you think it can leverage its relationships with those such as Microsoft Corporation (NASDAQ:MSFT), AT&T Inc. (NYSE:T) and International Business Machines Corp. (NYSE:IBM) to drive revenue and profit growth over the long term, the shares could prove lucrative. Based on prospects for its solutions businesses, I advise purchasing them for their turnaround potential. The stock is trading at a forward P/E of 13.4x, based on 2013 share net of $0.64.
Technology markets, such as display, broadcast and video communications, have favorable prospects as the products are marketed to businesses and consumers alike. At this juncture, certain such businesses could well be poised for upturns in the latter half of 2013. Thus, their stocks might well jump. Regardless, these companies seem to be investing in the right markets for long-term profit expansion, and would be good selections for most buy and hold accounts.
The article 3 Technology Stocks You Want to Watch originally appeared on Fool.com and is written by Damon Churchwell.
Damon Churchwell has no position in any stocks mentioned. The Motley Fool recommends Corning and Polycom. The Motley Fool owns shares of Corning. Damon is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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