It's been an up and down year for the technology sector. While large-cap players including Microsoft, Alphabet, and Apple have posted big gains across the stretch, many smaller players have seen volatile trading. Investors might be looking at recent market turbulence and wondering what comes next. 

While it's difficult to predict which trends will shape the market in the short term, the tech sector is still a great starting point for investors who are on the hunt for explosive growth. And recent market volatility has created opportunities to invest in promising companies at discounted prices. Read on for a look at two stocks that are worth adding to your portfolio before August falls off the calendar.

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Maintaining an overly strict dichotomy between value and growth can cause investors to miss out on some great opportunities. Zuora (ZUO -2.27%) isn't posting profits yet, and its forward price-to-sales multiple of roughly 5.6 might look high in comparison to other stocks that fall into the traditional "value" category. But it looks cheaply valued for a software-as-a-service (SaaS) category leader, and it could go on to crush expectations and serve up great returns for shareholders.

Zuora provides a software platform that makes it easy for companies to implement subscription-based billings and payments. The last two decades have seen rising adoption for subscription-based business models, and Zuora could continue to play an important role in powering the growth of the subscription economy.

Zuora is a category leader in its service niche, and there's a good chance that more businesses will pivot to subscription-based business models. Customers who sign up with a subscription service tend to stick around as long as the core product continues to be of reasonably high quality, and companies are prioritizing building recurring-revenue streams because these sales are more dependable and profitable over time.

That advantages of the subscription model will likely continue to attract new enterprise customers, and Zuora looks like a top play for benefiting from the growth of the overall subscription economy. On the other hand, it's also fair to note that its recent performance has been somewhat uneven.

The company's share price has slumped roughly 47% over the last three years as growth has fallen short of the market's expectations. Headwinds created by the pandemic have further complicated matters. Zuora isn't a low-risk stock, but it's worth a look for investors who are willing to weather potential volatility in pursuit of multibagger performance. 

With a market capitalization of roughly $1.9 billion, Zuora still has big room for growth, and the company looks like a worthwhile play for investors aiming to benefit from the growth of the subscription economy. Investors should proceed with the understanding that there's speculation involved in charting the company's future, but it could deliver big wins. 


It's been an interesting few years for Ubisoft Entertainment (UBSFY -2.03%). The French video game publisher was posting strong performance in 2018 thanks to successful releases in the Rainbow Six and Ghost Recon franchises, but subsequent installments fell short of expectations -- and that's made it more difficult to map what comes next for the video game publisher.

The company's share price is down roughly 40% over the last three years, and it's also down 43% from its 52-week high of roughly $21 per share. Not all is lost, however. Ubisoft is in the early stages of a business pivot that will see it concentrating on releasing more mobile and free-to-play (F2P) titles. This change of strategy will give the company an opportunity to meet a much wider audience and generate revenue through the sale of optional in-game items and currencies.

Is this new approach guaranteed to work? No, but it could have a huge payoff, and there are reasons to be optimistic about the company's long-term prospects.

With a market capitalization of roughly $7.3 billion, Ubisoft looks cheaply valued and could go on to deliver explosive performance. Just a single new successful franchise could dramatically alter the company's outlook, and it's not unreasonable to expect that it will prove the doubters wrong and serve up more big hits. 

The gaming industry looks poised for strong growth in coming decades as a growing number of players take up the hobby and an emerging global middle class paves the way for rising discretionary spending. Ubisoft's combination of proven development studios, time-tested marketing teams, and bankable franchises should help it benefit from rising demand for interactive entertainment, and the stock is a worthwhile buy for investors seeking exposure to the gaming space.