What are five undervalued tech stocks?

Kyndryl, Qualcomm, Lumen, AT&T, and Himax are five undervalued tech stocks.

Can cheap tech stocks be part of a long-term investment strategy?

Cheap tech stocks can be a good part of a long-term investment strategy, but investors should understand that even stocks that appear cheap by various metrics can carry substantial risk.

Do cheap tech stocks pay dividends?

Some cheap tech stocks pay dividends. Tech companies may opt to pay dividends to reward shareholders, or because returning cash directly to shareholders appears to be a better use of excess capital than pouring more money into growth bets.

How much should I invest in cheap tech stocks?

Investors should weigh their investment in cheap stocks in line with their personal risk tolerance and financial situation. While investing in companies trading at seemingly opportunistic multiples can be a path to substantial returns, these stocks can still experience significant valuation pullbacks, resulting in big losses for investors.

Cheap Tech Stocks for 2026 and How to Invest

These stocks can be considered a deal in the technology sector. Find out if these cheap tech stocks are right for you.

By Keith Noonan – Updated May 13, 2026 at 4:47 AM EST | Fact-checked by Frank Bass

Key Points

Cheap tech stocks may provide significant long-term investment returns.
Technology's influence on various industries makes it a prime investment area.
Alphabet and AT&T show potential for growth with their strong market positions.

Cheap tech stocks offer investors the potential to score massive long-term returns. The technology sector has played a leading role in powering the market's gains over the past couple of decades. New hardware, software, and services have driven changes in business and everyday life. Tech's ability to shape and influence almost every industry under the sun means the sector remains one of the best starting places for investors seeking big gains.

Seven undervalued tech stocks to consider

Following bouts of market volatility over the last several years, even some otherwise high-flying growth stocks might be considered a great long-term deal right now. And for many older and slower-growing tech stocks, valuations continue to look attractive. Here are seven companies with "cheap" tech stocks that could deliver strong returns over the long term:

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Ticker Information Table
Name and ticker	Market cap	Dividend yield	Industry
Kyndryl (NYSE:KD)	$2.7 billion	0.00%	IT Services
Applied Materials (NASDAQ:AMAT)	$355.9 billion	0.43%	Semiconductors and Semiconductor Equipment
Alphabet (NASDAQ:GOOGL)	$4.7 trillion	0.22%	Interactive Media and Services
AT&T (NYSE:T)	$172.9 billion	4.46%	Diversified Telecommunication Services
Himax Technologies (NASDAQ:HIMX)	$3.6 billion	1.79%	Semiconductors and Semiconductor Equipment
Qualcomm (NASDAQ:QCOM)	$246.0 billion	1.53%	Semiconductors and Semiconductor Equipment
Lumen Technologies (NYSE:LUMN)	$11.2 billion	0.00%	Diversified Telecommunication Services

Data as of May 28, 2026. Showing 7 of 7 total entries.

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1. Kyndryl Holdings

NYSE: KD

Kyndryl

Today's Change

(0.81%) $0.10

Current Price

$11.87

Key Data Points

Market Cap

$2.7B

Day's Range

$11.78 - $12.06

52wk Range

$10.10 - $44.20

Volume

31.7K

Avg Vol

3.9M

Gross Margin

21.82%

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Kyndryl (KD +0.81%) is an IT services company that was spun off from IBM late in 2021. The business was separated so that IBM could focus on units with stronger growth opportunities, but Kyndryl is now unlocking its potential as a stand-alone entity. It could also have some underappreciated growth catalysts on the horizon.

Kyndryl has seen a substantial valuation pullback in 2026 after the company announced it was lowering its sales and free cash flow guidance and delaying the official reporting of quarterly results to conduct an accounting review.

Kyndryl is trading at a forward price-to-earnings (PE) ratio of roughly 6. The uncertainty surrounding the company's accounting and performance outlooks explains why the stock is trading at such a low multiple. Still, shares could rocket higher if the outlook on these fronts improves.

2. Applied Materials

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NASDAQ: AMAT

Applied Materials

Today's Change

(0.14%) $0.65

Current Price

$448.90

Key Data Points

Market Cap

$356B

Day's Range

$438.34 - $457.64

52wk Range

$153.47 - $462.40

Volume

165.5K

Avg Vol

6.7M

Gross Margin

48.96%

Dividend Yield

0.43%

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Applied Materials (AMAT +0.22%) provides the equipment needed to manufacture semiconductors. Many chip companies are cyclical, with revenue and profits ebbing and flowing with consumer and business demand.

However, Applied Materials has a much more stable growth business model. New chip fabrication plants and expansions take years of planning, and their equipment requires ongoing service -- a source of revenue for Applied, as well.

The company should be able to continue its growth in line with the broader microchip manufacturing industry and increasing demand for network-connected industrial equipment, electric vehicles, and artificial intelligence (AI) technologies. Applied Materials consistently generates high operating profit margins and returns all of its free cash flow to shareholders via a dividend and share repurchases.

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3. Alphabet

NASDAQ: GOOGL

Alphabet

Today's Change

(0.38%) $1.49

Current Price

$390.32

Key Data Points

Market Cap

$4.7T

Day's Range

$385.17 - $391.50

52wk Range

$162.00 - $408.61

Volume

390.1K

Avg Vol

28.1M

Gross Margin

60.43%

Dividend Yield

0.22%

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One of the FAANG stocks (large tech companies with big competitive advantages), Alphabet (GOOG +0.40%) (GOOGL +0.39%) has posted big gains over the last year but could still offer appealing value. Alphabet's Google search business has emerged from pressures facing the overall digital advertising industry, and the company has returned to generating operating profit margins above 30%. It uses its profits to fund even higher-growth businesses, such as YouTube and Google Cloud, as well as emerging technologies, such as its self-driving car subsidiary Waymo.

Alphabet also had one of the largest cash and short-term investment (net of debt) balances of any public company at roughly $80 billion as of the end of 2025. When paired with its strong product suite and long-term expansion potential, there's a lot to like about Alphabet -- especially with shares trading at 27 times one-year forward expected earnings.

4. AT&T

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NYSE: T

AT&T

Today's Change

(-0.30%) $-0.07

Current Price

$24.82

Key Data Points

Market Cap

$173B

Day's Range

$24.77 - $25.13

52wk Range

$22.95 - $29.79

Volume

495.3K

Avg Vol

39.2M

Gross Margin

43.08%

Dividend Yield

4.46%

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AT&T's (T -0.30%) big vision to build a multimedia empire capable of complementing its telecommunications business didn't turn out as planned. In 2021, the company spun off its DirecTV satellite television business. The following year, the telecom giant spun off the Time Warner division that it had paid $85 billion to acquire, resulting in a merger that created Warner Bros. Discovery (WBD -0.52%). Although the move reduced cash-generating capabilities and led to a dividend cut, the company is now leaner and more efficient and still offers a strong dividend profile.

AT&T is back to focusing on telecommunications services, and it's likely in the early stages of benefiting from this shift, driving growth for its 5G and fiber internet businesses. Mobile connectivity and high-performance internet are increasingly central to business and everyday life, and digital connectivity will likely become even more important through the next decade and beyond. AT&T stock boasts a roughly 4.5% yield, and shares trade at approximately 11 times expected earnings for the year.

5. Himax Technologies

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NASDAQ: HIMX

Himax Technologies

Today's Change

(0.34%) $0.07

Current Price

$20.72

Key Data Points

Market Cap

$3.6B

Day's Range

$20.07 - $21.14

52wk Range

$6.85 - $22.44

Volume

75.6K

Avg Vol

4.7M

Gross Margin

30.55%

Dividend Yield

1.79%

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Himax Technologies (HIMX +0.34%) is a designer of display-driver and image sensor chips. The company's technologies are used to regulate the colors displayed by screen pixels, capture visual data for machine vision applications, and facilitate other display and sensing functions. Its designs are used in televisions, automotive displays, and a range of other hardware devices.

Himax is a cyclical stock, and its business performance has tended to fluctuate significantly with the launch of new technologies and demand trends in its key end markets. On the other hand, increasing demand for automotive display and visual sensing technologies looks poised to power strong performance for the company.

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6. Qualcomm

NASDAQ: QCOM

Qualcomm

Today's Change

(5.26%) $12.27

Current Price

$245.67

Key Data Points

Market Cap

$246B

Day's Range

$231.54 - $249.40

52wk Range

$121.99 - $258.00

Volume

529.7K

Avg Vol

19M

Gross Margin

54.80%

Dividend Yield

1.53%

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Almost every smartphone on the planet contains some sort of Qualcomm (QCOM +5.26%) chip. As mobility expands to encompass other devices (cars, smart-home devices, industrial equipment, etc.), Qualcomm is finding new avenues for growth. Yet largely due to a widespread belief that Apple (AAPL -0.21%) will eventually completely part ways with Qualcomm and use its own mobile chips for the iPhone and iPad, Qualcomm trades for less than many of its semiconductor industry peers.

In the spring of 2026, Qualcomm's stock was valued at just 19.5 times expected earnings for the year. But over the next few years, the company expects to see much more growth from new mobility and AI chip designs. Along the way, shareholders potentially will be treated to a modest dividend yield and share repurchases to sweeten the deal.

7. Lumen Technologies

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NYSE: LUMN

Lumen Technologies

Today's Change

(-2.16%) $-0.23

Current Price

$10.63

Key Data Points

Market Cap

$11B

Day's Range

$10.50 - $10.86

52wk Range

$3.37 - $11.95

Volume

6.8M

Avg Vol

13.2M

Gross Margin

25.03%

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Lumen Technologies (LUMN -1.93%) is a telecommunications and networking technology company in the midst of a major transition. The company is pivoting away from the consumer market toward the booming enterprise data center market.

Lumen's Private Connectivity Fabric (PCF) technologies have won big deals with customers, including Microsoft (MSFT +3.51%) and Meta Platforms (META -0.51%), and the tech specialist has also forged a partnership with Palantir (PLTR +7.31%).

Despite some potentially powerful growth drivers on the horizon, Lumen was valued at roughly 80% of its expected 2026 sales this spring. If the company continues to score wins in the AI market, time may show that the stock was very cheap at that multiple.

How to buy cheap tech stocks

Open your brokerage app: Log in to your brokerage account where you manage your investments.
Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
Submit your order: Confirm the details and submit your buy order.
Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.

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Benefits and risks of investing in cheap tech stocks

Investing in tech stocks that look cheap relative to key valuation metrics and long-term growth opportunities can be a way for investors to score massive long-term returns.
Almost every company will go through challenging periods. Investing in high-quality tech stocks that have suffered big sell-offs can open the door for shareholders to see very strong results when performance improves.
Sometimes "cheap stocks" are cheap for a reason, and investors should always be conscious of the execution and valuation risks involved before buying heavily into a stock.
Valuation multiples are tools that rarely tell the full story for a company and its stock, and investors should understand that there is often a high level of uncertainty when evaluating tech stocks that look cheap on a fundamental basis or relative to potential long-term opportunities.

Why invest in cheap tech stocks

Investing in cheap tech stocks is a way for investors to gain exposure to companies with low sales and earnings multiples relative to their long-term performance potential. Companies in this category are often relatively mature or undergoing major business pivots. Investing in these stocks offers a chance to capitalize on underappreciated growth and execution opportunities.

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What to look for in undervalued tech stocks

Investors are generally well served by keeping an eye on tech companies' sales and earnings growth, as well as valuation metrics such as price-to-sales and price-to-earnings ratios.
It's helpful to keep an eye on each company's number of active users or customer count, and on how much per-user or per-client sales and profit it generates.
There's no reliable one-size-fits-all approach for evaluating stocks in the space, but charting business momentum and keeping intrinsic value in mind can make it easier to identify winners.

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FAQ

Cheap tech stocks FAQ

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About the Author

Keith Noonan is a contributing writer at The Motley Fool covering technology, consumer goods, and other sectors. He holds a bachelor’s degree in English from Boston College.

TMFNoons

Keith Noonan has positions in Himax Technologies. The Motley Fool has positions in and recommends Alphabet, Apple, Applied Materials, Himax Technologies, Kyndryl, Meta Platforms, Microsoft, Palantir Technologies, Qualcomm, and Warner Bros. Discovery. The Motley Fool has a disclosure policy.

Cheap Tech Stocks for 2026 and How to Invest

These stocks can be considered a deal in the technology sector. Find out if these cheap tech stocks are right for you.

Key Points

Seven undervalued tech stocks to consider

1. Kyndryl Holdings

Key Data Points

2. Applied Materials

Key Data Points

3. Alphabet

Key Data Points

4. AT&T

Key Data Points

5. Himax Technologies

Key Data Points

6. Qualcomm

Key Data Points

7. Lumen Technologies

Key Data Points

How to buy cheap tech stocks

Benefits and risks of investing in cheap tech stocks

Why invest in cheap tech stocks

What to look for in undervalued tech stocks

Related investing topics

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Best Cloud Computing Stocks for 2026 and How to Invest

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FAQ

Cheap tech stocks FAQ

What are five undervalued tech stocks?

What are five undervalued tech stocks?

Can cheap tech stocks be part of a long-term investment strategy?

Can cheap tech stocks be part of a long-term investment strategy?

Do cheap tech stocks pay dividends?

Do cheap tech stocks pay dividends?

How much should I invest in cheap tech stocks?

How much should I invest in cheap tech stocks?

About the Author

Read Next

Stocks Mentioned

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Premium Investing Services

Seven undervalued tech stocks to consider

Key Data Points

2. Applied Materials

Key Data Points

4. AT&T

Key Data Points

5. Himax Technologies

Key Data Points

Key Data Points

7. Lumen Technologies

Key Data Points

How to buy cheap tech stocks

Benefits and risks of investing in cheap tech stocks

Why invest in cheap tech stocks

What to look for in undervalued tech stocks

How to Invest in the Vanguard Growth ETF (VUG)

Best Cloud Computing Stocks for 2026 and How to Invest

Best Stocks to Buy in May 2026

5 Best Metaverse Stocks in 2026 and How to Invest

Cheap tech stocks FAQ

What are five undervalued tech stocks?

What are five undervalued tech stocks?

Can cheap tech stocks be part of a long-term investment strategy?

Can cheap tech stocks be part of a long-term investment strategy?

Do cheap tech stocks pay dividends?

Do cheap tech stocks pay dividends?

How much should I invest in cheap tech stocks?

How much should I invest in cheap tech stocks?

Key Data Points