Bernstein analysts named a slew of tech shares as its greatest concepts in 2024. These corporations are firing on all cylinders and have extra room to run, the analysts mentioned. CNBC Professional combed by way of Bernstein analysis to seek out the agency’s favourite tech shares in 2024. They embody: Broadcom , Uber, PDD , Taiwan Semiconductor and Seize . Seize Shares of the the Southeast Asia ride-hailing and supply meals firm have lagged some friends in america, however that is not stopping analyst Venugopal Garre from naming the inventory as a prime tech choose heading into subsequent 12 months. The agency mentioned it sees an “attractive risk reward with continuous profitability improvement.” In a slide presentation to purchasers, Garre listed a number of catalysts forward together with a pick-up in journey hailing momentum and a backside in meals supply. On-demand providers are gaining share, too, he wrote, whereas Seize has “reached industry leading reported margins in Food/Ride,” the agency added. Seize can also be poised to be a participant in M & A exercise as meals supply gamers consolidate in some Asian international locations, based on Garre. “Overall, we believe that the risk-reward profile for Grab is favorable,” he concluded. Broadcom “This is a phenomenal business,” analyst Stacy Rasgon mentioned of the semiconductor firm. Now, its enterprise is about to get even higher with the completion of its VMWare acquisition, the agency mentioned. “Broadcom’s stock has historically shown strong returns post-deal close as accretion flows in,” he mentioned. As well as, Rasgon famous, Broadcom is without doubt one of the “few ‘real’ AI stories in the space.” AI represents about 25% of the corporate’s semiconductor income, based on Bernstein. In the meantime, the inventory is comparatively cheap regardless of shares being up 88% this 12 months. “AVGO’s valuation remains attractive, sitting at a sharp discount to the sector despite the run the stock has had this year,” he wrote. Uber “From cash burn to cash build – UBER is now a real company,” analyst Nikhil Devnani mentioned of the ride-hailing large. The agency mentioned Uber is “still a growth business” with additional capacity to take share in supply and ride-sharing. “Delivery is proving to be sticky … and is increasingly profitable – people like convenience,” he wrote. The agency mentioned administration is executing and the arrival of latest merchandise is paying off. Devnani additionally likes the chance for free-cash move progress, which he calls “compelling.” “UBER has the capacity to return significant amounts of capital over time given organic cash build and monetizable assets,” he added. The inventory is up 150% this 12 months with extra room to run, based on the agency. “The core business is hitting its stride, with scale and cross-sell benefits driving market share gains,” he mentioned. PDD “PDD continues to gain share within the domestic e-commerce market – we think the recent gains go beyond poor macro and consumers down trading. … PDD has won close to a 40% share of incremental industry [gross merchandise value] in the past year; we’re optimistic this can continue. … PDD continues to outperform in China e-commerce. … We think PDD’s take rate has room to go higher.” Taiwan Semiconductor “We Believe TSMC Will Remain Ahead of Intel and Will Be Producing Some Compute Tiles From Intel. …. We project this adds 1-3% of incremental revenue to TSMC in late 2024 and more in 2025, and helps make Intel contribute ~10% of TSMC’s total revenue. … We reiterate Outperform and choose TSMC as our Best Idea for 2024.” Uber “From cash burn to cash build – UBER is now a real company … still a growth business. … The core business is hitting its stride, with scale & cross-sell benefits driving market share gains. … Delivery is proving to be sticky … & is increasingly profitable – people like convenience!. … Compelling FCF growth at a reasonable price. … UBER has the capacity to return significant amounts of capital over time given organic cash build & monetizable assets.” Broadcom “Combines a phenomenal core narrative with one of the few truly meaningful AI stories in the space. … First things first – this is a phenomenal business … Broadcom’s stock has historically shown strong returns post-deal close as accretion flows in. … AVGO’s valuation remains attractive, sitting at a sharp discount to the sector despite the run the stock has had this year.” Seize “Attractive risk reward with continuous profitability improvement. … Grab has reached industry leading reported margins in Food/Ride. … Grab is also considering purchase of Foodpanda asset. If Grab acquires it and gets regulatory approval, it will be a key catalyst if the acquisition price is considered good. … Overall, we believe hat the risk-reward profile for Grab is favorable.”
