Even as the S&P 500 notched a new all-time high within the past few weeks, there are still many stocks that look like attractive buys. In the tech world, artificial intelligence (AI) is dominant right now. If a stock has "AI" attached to its product or name, then it's likely doing quite well. But that leaves other stocks that have been left behind simply because AI isn't their primary product, or they aren't making as big a deal about it as others.
That gives investors strong buying opportunities as the stocks don't have a premium price tag. With that in mind, I think there are three great tech stocks that investors should be loading up on before April is over.
Alphabet
Alphabet (GOOG 0.33%) (GOOGL 0.35%) has made a significant number of investments in the AI realm. While that's a fair point, many investors are overlooking that Alphabet is still primarily an advertising business. In the fourth quarter, advertising revenue comprised 76% of Alphabet's total, making it by far the major part of its business.
Ad revenue increased by 11% in Q4, but this is a significant growth acceleration compared to previous quarters, as Alphabet's ad growth rate was 9% in the third quarter and 3% in the second. This indicates that the ad market is recovering from last year's downturn, making it a great time for investors to hop into the stock before significant growth occurs.
Alphabet's stock also doesn't carry a massive premium like some of its peers. Its trailing price-to-earnings (P/E) ratio is right around its average over the past five years.
GOOGL PE Ratio data by YCharts
However, its forward P/E is quite a bit lower, which indicates there should be some growth ahead. This makes Alphabet a great stock to load up on now as its primary business is starting to hit its stride again.
dLocal
dLocal (DLO 1.82%) is a fintech stock that flies under most investors' radar, which is a shame. dLocal's products allow companies to do business in countries with less developed payment ecosystems, like India, Vietnam, Turkey, Nigeria, or El Salvador. By creating the partnerships necessary within each country with its own unique payment system, it saves its customers from having to develop a unique system for doing business in each country. This makes selling within these emerging markets much easier.
With customers like Amazon, Spotify, Microsoft, and Shopify among its clients, dLocal's reputation is already established.
dLocal's growth has also been impressive. In Q4, its revenue rose 59% year over year to $188 million on the back of 55% growth in total payment volume to $5.1 billion. It's also already profitable, posting earnings per share (EPS) of $0.10 in the quarter -- good enough for a 15% profit margin.
With dLocal's stock trading at just 32 times trailing earnings and 26 times forward earnings with its growth rates, it's a strong stock pick at these levels.
Procore
While most industries have undergone a digital transformation that uses software to improve the efficiency and communication of all parties, construction hasn't. That's because the internet infrastructure wasn't good enough on job sites to use these programs. With that barrier now mostly out of the way, it opens the door for construction management software like Procore (PCOR -1.57%) to take effect.
Procore's construction management software creates a central source for all construction project members. This allows contractors to pull the latest iterations of drawings from the program, thus helping to avoid potential communication errors or out-of-revision drawings. This makes Procore a no-brainer product to implement for most construction sites, which has been reflected in Procore's growth.
In Q4, Procore's revenue rose 29% year over year to $260 million. While not profitable from a traditional basis, it produced $41 million in free cash flow, which means Procore could survive without external funding. Management also gave strong growth projections for 2024, as revenue in the first quarter is expected to rise around 23% to 24%, and full-year revenue should increase by 20%.
PCOR PS Ratio data by YCharts
This is healthy growth and exceeds the levels of some AI software companies. Despite that, Procore's stock doesn't fetch a premium valuation. At just under 11 times sales, Procore's stock doesn't tip the scales at over 20 times sales like many AI stocks do.
With a popular product, a great stock price, and a growing business, Procore looks like a good company to invest in if you want to avoid the AI hype.
