Top Smart-Home Stocks to Buy in 2019
Smart homes and buildings are becoming increasingly popular with a projected market growth of 18% according to Acumen Researching and Consulting. The internet of things, and IFTTT (If this then that) has allowed for individuals to create systems that works together with minimal human intervention.
Automation and connected smart appliances have seen a huge rise in demand in recent years. Amazon recently acquired Eero and previously paid $1 billion to acquire Ring, a doorbell-camera startup. It had acquired Blink, a smart camera maker in 2017.
Google also invested heavily in the smart-home game a few years ago when it acquired Nest for 3.2 billion. Nest was quiet for a few years after its acquisition by Google but recently launched new temperature sensors, a video doorbell and an outdoor smart camera.
Smart lights, security, entertainment systems, and temperature control are the principle smart devices in demand. These products are surely to grow as we become more invested in energy-saving and healthy lifestyles.
Most of these smart devices work with voice assistants, but read carefully as not all are compatible, depending on your brand. Apple’s Homekit is an example of a software framework that lets you use a smart device with Siri.
Nest smart-home products at B&H
Here are the top companies developing smart homes products…
It's 26% off its highs. No, they won't grow at 54% YOY as they did during the pandemic, but they are still double-digit earners and hold $63 billion of free cash flow at 3.63% (though he'd prefer over 5%). There continues to be value here. Likes it.
Sony Corp. ADR (SNE-N)
They offer a suite of voice assistant enabled smart products that help automate the home. You can even control your Sony TV through Google Home.
Q4 results topped expectations. Spiderman game and PlayStation doing well. Market leader in gaming consoles, 64% market share. 44% market share of sensors. Lots of horses in stable. 12-month average price target is $130. Yield is 0.60%. (Analysts’ price target is $145.56)
Homekit, along with the Home app, is the company’s smart home system used as a platform for iOS user. The platform brings multiple devices together and coordinates their actions.
Likes it, but isn't buying it now, because Apple is protected by major telcos offering Apple phones.
A leader in e-commerce and they sell smart home solutions that also works with their voice assistant, Alexa. They help you get what you need to turn your home smart, and a way to control everything.
Step back, recognize it's a very defensible business. Consumer spending habits are changing, and AMZN's in the middle. Eventually, it will benefit. AWS growth rate slowing, but still quite high. Buy now, tuck away, don't look at it for 12 months. Unionization is not a thesis-changing argument.
Alphabet Inc. (A) (GOOGL-Q)
They acquired Nest and is a big player in connected home devices. Many devices connect through their Google Home platform.
Some stocks not on Stockchase are also worth mentioning : Alarm.com NASDAQ: ALRM, Control4 NASDAQ: CTRL and Sonos NASDAQ: SONO are among many smart-home stocks you should watch. Other companies are also involved and benefit from the home automation rise in demand even if they don’t develop consumer products themselves, here are more smart-home related stocks :
Canon Inc. (CAJ-N)
Smart all-in-one printers are the mainstay of a smart-office. Canon offers multiple solutions for big and small sized companies and help automate the workplace.
Unfortunately they have had a tough time. Camera division is doing extremely well. Coming out with new cameras. He is scrutinizing it hard. 4.2% dividend is safe. Strong balance sheet. If camera division takes a turn to the worse he would sell.
A supplier of billing and back-office support for telecommunication and cable companies. They offer real-time intelligence capabilities for contextualized customer engagement.
He just bought this midcap. A third of the Russell 2000 stocks are profitable and outgrowing the S&P; not subject to currency or tariff changes; they serve domestic markets. This is an infotech company that will serve sectors that will endure. It's a safe place to hide because they service domestically, are cash-flow positive and…
Logitech International SA (LOGI-Q)
Harmony Hub takes all your devices and lets you control them with your smartphone. They are working on creating a universal controller.
They make wireless computer mouses, pointing devices, etc. They benefitted during COVID as did their profits, because people were staying home. A high quality business with good cash flow. They are looking to enter, but not sure at what level.
Marvell Technology Group (MRVL-Q)
They produce storage, communications, and consumer semiconductors. Their digital semiconductors for consumer communications is used in smart home technology.
Setting up storage facilities in Ottawa, Toronto, Vancouver. Strong leader in storage, networking, switching, data processing. Big 2018 acquisition accelerated total addressable market. Strong connection with Samsung on 5G. Decent runway. (Analysts’ price target is $61.50)
Silicon Laboratories Inc (SLAB-Q)
A semiconductor producer that is used widely in cell-phones and smart devices.
(A Top Pick Jan 26/05. Down 36%.) Face the opportunity for single chip cell phone technology to penetrate the low end of the market. Went up 30% and he sold. Looking at it again.
They create chips that power the smart home devices. They have good technical support, and could break out, but semiconductors have done poorly recently.
Just reported a good earnings, but this doesn't mark the start of a new age for Intel. The stock has long been very undervalued, though. She's owned this for a long time at 1% of her portfolio. Intel will make money and probably grow earnings in the future. Unlike AMD, she can make a case…
A strong player in the IoT space, offering connectivity and machine intelligence to smart home technology. They offer security and automation technology to consumers.
Decent runway going forward. Lots of volatility. More geared to data centres and gaming. His position is around 2.75%. Likes this one, very much recommends it. (Analysts’ price target is $167.00)
They’re focusing on home security and automation systems to protect your home and family.
Higher interest rates will be tough on company (lots of leverage). Company is a bond proxy with stability. Going forward, dividend is strong and balance sheet getting much stronger. Waiting for debt to come down before buying.
AMERICA MOVIL, S.A.B. DE C.V. (AMX-N)
They are working on 5G technology and are working to commercialise smart products to tap into the IoT universe.
(A Top Pick June 5/07. Down 8%.) Largest cellular company in Mexico. Their capacity utilization of the network is superior to many other global ones. Very Bullish on this stock.
Home Depot (HD-N)
You can get everything you need to connect your home. They’ve profited from the DIY boom and smart homes could be the next big thing.
He bought more of this. He remains under-invested and holding a lot of cash, but he can't pass up opportunities. HD's valuation has come down a lot (unlike megatechs like Amazon).
Best Buy Company Inc (BBY-N)
A name synonymous with consumer technology. They offer a wide variety of smart homes devices, and smart home systems.
(A Top Pick Nov 17/22, Up 23.5%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with BBY has achieved its $86.00 objective. To remain disciplined, we recommend covering half the position at this time and trailing up the stop-loss (from $62.50) to $70.00.
Office Depot (ODP-Q)
They offer a smart home and office installation service that installs and connects Google and Nest products to you building.
Audiovox Corp. (VOXX-Q)
A custom home automation and consumer electronics company. They are working on connecting residential and commercial properties.
No debt and $160 million in cash, a little over $7 per share. Chairman owns 20%. Not widely followed.
Comcast Corp (CMCSA-Q)
Its Xfinity brand has driven their smart home products. They specialize in smart voice-drive TV experiences. They also have partnerships with home security and smart lock companies.
Streaming market share of company has hit record numbers. Expects consumers to spend less on streaming. Good business model overall. Current share price presenting good buying opportunity.
ABB Ltd. (ABB-N)
A Swedish-Swiss multinational that develops robotics, power, and automation technology. They are working on building smart grids. These grids are adaptive and responsive, and many current infrastructure needs replacing. These smart grids have a big potential when these infrastructures are redone.
Honeywell International (HON-N)
They have consumer smart home solutions, including thermostats, and security systems. It has a good management team and they have good branding.
There's a strong secular tailwind for agriculture as well as capital expenditure to produce greater efficiency. She'd be looking at automation, like Rockwell and Honeywell. Then, how do you move those goods? Look at Union Pacific. There are various ways to play the industrial sector as you move into 2023. She expects capex in private…
General Electric (GE-N)
They have smart outlets and security systems. However, it’s been beaten down a lot, and analysts are wary. They are not cash flow positive, and the business is trying to sell off assets trying to survive.
Recent stock action is largely systemic, it's participating with the market. HON buying some GE assets has allowed it to get off the debt wagon. But now it's left with its worst assets. Take your tax loss, move on. Look at HON instead.
Johnson Controls (JCI-N)
An automotive batteries and electronics, and HVAC equipment producer. They also have their building automation system. The system helps keep occupants safe and productive.
(Top Pick Feb 6/17, Down 2%) He expects that it will probably get back to $42-$45. Typically auto does well until the end of May.
Eaton Corp. (ETN-N)
Provides engineering equipment to different companies. They are a key player in the global human machine interface (HMI) race. HMI is a growing market especially due to the rising demand for lower expenses.
She bought it recently, because it will be tied to the supercycle is coming. Has a lot of upside in earnings in the next 3 years.
They manufacture electronic instruments and electromechanical devices. They make monitors for many industries, including pharma and oil. A leader in highly engineered electrical connectors.
Electronic equipment that makes monitors for many industries from pharma to oil. Established international company. ROIC rose from 14% in 2009 to 26% now. Stock is still cheap. $17B market cap. $3.8B in revenue. Consistent, well-diversified company.
Anixter International (AXE-N)
A communications and security products company. They offer a full-line solutions. A leader in helping businesses and communities build reliable systems.
(Top Pick Oct 4/13, Up 2.40%) It is core industrial America. Just made an acquisition that will be accretive right off the bat.