Even though it’s a favorite of Warren Buffet, and coming off of a good quarter, shares still aren’t that expensive. IBM’s future prospects look bright, with the company recently raising its full-year outlook.
A discounted glass-maker
Corning Incorporated (NYSE:GLW) is a leader in the display technologies segment, and also provides the glass for most touch devices (from iPhones to the Galaxy S4). Corning Incorporated (NYSE:GLW) recently beat estimates on both its top and bottom lines, but shares still fell by as much as 3%.
Corning Incorporated (NYSE:GLW) was already cheap, but the drop in share price provides an even better entry point for investors. Corning Incorporated (NYSE:GLW) trades at only 13 times earnings, and around 11 times forward earnings.
This unloved, boring stock is also maintains a solid balance sheet boasting more cash than debt:
Corning Incorporated (NYSE:GLW) also seems to have gotten the hint that investors love dividends, as it has begun to increase its payout:
A trend of consistent dividend increases may eventually attract a bigger crowd. Shares currently yield around 2.60%.
So what about the future? Corning Incorporated (NYSE:GLW)’s CEO elaborated that its signature Gorilla Glass product can eventually evolve into a $2 billion market. Keep in mind that this product wasn’t even existent 5 years ago, and it now accounts for 17% of the company’s revenues, according to Bloomberg. Gorilla Glass is now found in over 1.5 billion devices.
Gorilla Glass will also provide great growth if the company successfully integrates it into things such as car windshields, which it plans to, according to Corning Vice President Jeff Evans. Bigger pieces of glass mean more profits for Corning.
The bottom line
Microsoft Corporation (NASDAQ:MSFT), IBM, and Corning seem to be in Mr. Market’s doghouse for now– especially Microsoft. Quarterly concerns don’t always spell long-term doom, however. Microsoft Corporation (NASDAQ:MSFT) is incredibly strong financially and pays out a safe, income-generating dividend
IBM may be a better bet for those seeking capital appreciation. The company’s recent quarter, while not stellar, was a huge improvement from the quarter preceding it.
With such a strong balance sheet and coming off a relatively strong quarter, Corning is a great value play with good growth prospects.
These three companies make a nice little basket of dividend-paying tech stocks. Just make sure to keep your eyes on their performance as you’re collecting your dividends.
The article 3 Unloved Tech Stocks to Buy Now originally appeared on Fool.com and is written by Joseph Harry.
Joseph Harry owns shares of International Business Machines (NYSE:IBM)., Microsoft, and Corning. The Motley Fool recommends Corning. The Motley Fool owns shares of Corning, International Business Machines., and Microsoft. Joseph 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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