While the broader technology sector is still recovering from last year’s recession, savvy investors will want to focus on a promising and thriving field in edge computing. In fact, this paradigm effectively brings data computation and storage closer to the devices where it is collected, dramatically improving efficiency. Therefore, investing in the best IT stocks to buy could prove incredibly profitable in the long run.
According to Mordor Intelligence, the edge computing market, valued at $6.80 billion in 2022, is expected to skyrocket to $58.60 billion by 2028. Therefore, this reflects a compound annual growth rate (CAGR) by around 45% during the 2023-2028 forecast period.
With that said, let’s take a look at the most promising edge computing stocks. These are companies that focus on increasing productivity for their clientele, leading to significant cost reductions in various industries.
|A NETWORK||Arista Networks||$162.52|
Akamai (NASDAQ:AKAM) is a heavyweight in edge computing, with its global network of thousands of distributed servers. Its powerful network enables its customers to reap the benefits of edge computing, improving operational efficiency.
Notably, the company has established its position as a titan in the realm of content delivery networks (CDNs). As a result, Akamai excels at facilitating the secure transfer of data between entities, backed by a colossal CDN of approximately 350,000 servers spread across more than 134 countries and more than 1,300 networks globally.
Akamai has run a tremendously profitable business with industry-leading metrics. For example, over the past five years, EBITDA, net income and leveraged free cash flow margins have increased by 31%, 15.3% and 17.2%, respectively. It has also proven to be an excellent wealth compound, generating over 100% total shareholder returns over this period. Notably, AKAM shares are still trading at a discount to many of its historical price metrics.
Quickly (NASDAQ:FSLY) has successfully made its mark on the burgeoning field of edge computing by providing a platform that enables the creation of globally distributed large-scale applications. Fastly’s offerings effectively eliminate the need to manage the underlying infrastructure, offering a “faster, simpler, more secure” solution than many of its competitors.
The company’s versatile cloud edge platform excels at content delivery, web and mobile application optimization, and real-time data processing. Its platform ensures fast data processing and competent handling of large data volumes. Additionally, its robust, high-performance Edge Cloud platform delivers a complete, holistic network services solution that encompasses security, compute, and observability.
Quickly runs a hyper-growth business, growing more than 30% annually for the past five years. However, its rapid expansion has come at the expense of its profits. However, the company has made significant progress in breaking even and is estimated to become profitable within the next few years.
Arista Networks (ANET)
Cloud network service provider Arista Networks (NYSE:A NETWORK) has actually stood out in the realm of edge computing with a strategic shift towards “campus cloud” solutions. Building smaller on-premises data centers for enterprise customers demonstrates the company’s commitment to the fundamental principles of edge computing, which include fast data processing and low latency.
Plus, there’s Arista’s AI-powered security platform, a testament to its dedication to cybersecurity, which addresses the inherent security issues of edge computing with the distributed nature of data. The platform’s focus on enabling a zero-trust strategy, automated threat hunting, and network forensics facilitates the secure adoption of edge computing. Additionally, the combination of innovative cloud solutions and strong cybersecurity makes Arista Networks an attractive prospect on the list of high-potential edge computing stocks to buy.
A look at its brilliant fundamentals, marked by historic double-digit growth on both the top and bottom, points to incredible upside for ANET stock.
As of the date of publication, Muslim Farooque did not hold (either directly or indirectly) any positions in the securities mentioned in this article. Opinions expressed in this article are those of the writer, subject to InvestorPlace.com posting guidelines
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