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Top Smart-Home Stocks to Buy in 2019

Melisa R. H.Melisa R. H. Posted On March 28, 2019
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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

Nest smart-home products at B&H

Here are the top companies developing smart homes products…

💻 Technology

Microsoft (MSFT-Q)
Cortana, the voice assistant, can be used to control compatible smart devices. The IFTTT chains helps you automate actions.

Microsoft (MSFT-Q) — Stockchase
Microsoft (MSFT-Q) — Stockchase

MSFT vs. APPL Apple is a consumer products company, whereas MSFT is an enterprise company. Both trade at similar multiples. Great balance sheets, buy back shares, increase dividends. Apple relies on growing iPhone and 5G. Will continue to do well. The iCar is an expensive proposition. MSFT has really benefited from cloud infrastructure growth. Better…

stockchase.com stockchase.com

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.

Sony Corp. ADR (SNE-N) — Stockchase
Sony Corp. ADR (SNE-N) — Stockchase

Despite having an amazing run, Sony is undervalued as is the entire Japanese market. A definite buy.

stockchase.com stockchase.com

Apple (AAPL-Q)
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.

Apple (AAPL-Q) — Stockchase
Apple (AAPL-Q) — Stockchase

An essential 5G play They just launched a new iPhone in October that can run on 5G. An obvious 5G play that is poised to capitalize on the rollout. An investment, not a trade. Apple is asking suppliers for 96 million units this year. The new phone is selling very well in China. Service revenue…

stockchase.com stockchase.com

Amazon.com (AMZN-Q)
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.

Amazon.com (AMZN-Q) — Stockchase
Amazon.com (AMZN-Q) — Stockchase

He has a small position. It is similar to AAPL-Q. They are dominant in many of the areas in which they operate. It is not a cheap stock. But he would not bet against them.

stockchase.com stockchase.com

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.

Alphabet Inc. / Google (GOOG-Q) — Stockchase
Alphabet Inc. / Google (GOOG-Q) — Stockchase

Revenue growth will continue to be strong. Will benefit from more and more digital advertising. If he had to choose this or Facebook, he'd choose FB, but it's close.

stockchase.com stockchase.com

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.

Canon Inc. (CAJ-N) — Stockchase
Canon Inc. (CAJ-N) — Stockchase

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.

stockchase.com stockchase.com

Amdocs (DOX-Q)
A supplier of billing and back-office support for telecommunication and cable companies. They offer real-time intelligence capabilities for contextualized customer engagement.

Amdocs (DOX-Q) — Stockchase
Amdocs (DOX-Q) — Stockchase

One theme she really likes is a company that provides products and services that other companies simply can't live without. This company is so ingrained with other businesses processes. They work with AT&T, BCE, Telus, Rogers and Vodafone. Do back-end billing, making sure you are getting charged what you are supposed to be charged for…

stockchase.com stockchase.com

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.

Logitech International SA (LOGI-Q) — Stockchase
Logitech International SA (LOGI-Q) — Stockchase

People need to buy their peripherals (mice, keyboards) to set up their home offices. LOGI benefits from the work-from-home trend during Covid.

stockchase.com stockchase.com

Marvell Technology Group (MRVL-Q)
They produce storage, communications, and consumer semiconductors. Their digital semiconductors for consumer communications is used in smart home technology.

Marvell Technology Group (MRVL-Q) — Stockchase
Marvell Technology Group (MRVL-Q) — Stockchase

An essential 5G play Many chipmakers to choose from, but Marvell is the best 5G play here. The only problem is a supply shortage due to high demand.They make chips and are a 5G play. Has a partnership wtih MSFT to make in-house server chips. Shares are trading at nosebleed levels now, though.

stockchase.com stockchase.com

Silicon Laboratories Inc (SLAB-Q)
A semiconductor producer that is used widely in cell-phones and smart devices.

Silicon Laboratories Inc (SLAB-Q) — Stockchase
Silicon Laboratories Inc (SLAB-Q) — Stockchase

(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.

stockchase.com stockchase.com

Intel (INTC-Q)
They create chips that power the smart home devices. They have good technical support, and could break out, but semiconductors have done poorly recently.

Intel (INTC-Q) — Stockchase
Intel (INTC-Q) — Stockchase

They just replaced their CEO after missing several sales misses. The new CEO did a good job at WMware.

stockchase.com stockchase.com

Qualcomm (QCOM-Q)
A strong player in the IoT space, offering connectivity and machine intelligence to smart home technology. They offer security and automation technology to consumers.

Qualcomm (QCOM-Q) — Stockchase
Qualcomm (QCOM-Q) — Stockchase

An essential 5G play Their platform is essential for 5G network. They spent year working on this technology. Customers include Apple. With 5G approaching, they'll see a payoff. Sells less than 20x 2022 earnings.

stockchase.com stockchase.com

AT&T (T-N)
They’re focusing on home security and automation systems to protect your home and family.

AT&T (T-N) — Stockchase
AT&T (T-N) — Stockchase

Too risky. Don't buy this only for the yield. Never.

stockchase.com stockchase.com

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.

AMERICA MOVIL, S.A.B. DE C.V. (AMX-N) — Stockchase
AMERICA MOVIL, S.A.B. DE C.V. (AMX-N) — Stockchase

(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.

stockchase.com stockchase.com

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.

Home Depot (HD-N) — Stockchase
Home Depot (HD-N) — Stockchase

Dominant in its category. Will be able to do at-home delivery. Ahead of the curve. Benefiting from downfall of Pier 1 and others. Big and getting bigger. Yield is 2.27%. (Analysts’ price target is $303.05)

stockchase.com stockchase.com

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.

Best Buy Company Inc (BBY-N) — Stockchase
Best Buy Company Inc (BBY-N) — Stockchase

Allan Tong’s Discover Picks Best Buy is trading only $6 lower than its average price target of $116. Even though the wind is at its back, it’s likely wise to wait for a pullback before entering or adding more. Existing shareholders have been rewarded with a 74.56% total one-year return at a 3.53% profit margin…

stockchase.com stockchase.com

Office Depot (ODP-Q)
They offer a smart home and office installation service that installs and connects Google and Nest products to you building.

Office Depot (ODP-Q) — Stockchase
Office Depot (ODP-Q) — Stockchase

Has been outperformed by Staples. Global. Good balance sheet. Good cash flow. New management coming in.

stockchase.com stockchase.com

Audiovox Corp. (VOXX-Q)
A custom home automation and consumer electronics company. They are working on connecting residential and commercial properties.

Audiovox Corp. (VOXX-Q) — Stockchase
Audiovox Corp. (VOXX-Q) — Stockchase

No debt and $160 million in cash, a little over $7 per share. Chairman owns 20%. Not widely followed.

stockchase.com stockchase.com

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.

Comcast Corp (CMCSA-Q) — Stockchase
Comcast Corp (CMCSA-Q) — Stockchase

He likes it. Known from providing high-speed internet in the U.S. which enjoys high barriers to entry. Good cash flow. Problem here are the theme parks it owns, down 70% in attendance because of Covid; they may even close down. The broadband business is doing very well, undervalued and Comcast will do well in the…

stockchase.com stockchase.com

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.

ABB Ltd. (ABB-N) — Stockchase
ABB Ltd. (ABB-N) — Stockchase

Are they connected enough to green? They focus on smart grids, building grids that connect renewable projects. Now is an interesting time for grid development. Many, like Ontario's, are ancient and need updating. ABB is a play on smart (adaptive, responsive) grids, which are really expensive. If there's more infrastructure spending to update the grid…

stockchase.com stockchase.com

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.

Honeywell International (HON-N) — Stockchase
Honeywell International (HON-N) — Stockchase

It just hit new 2020 highs. An amazing feat during Covid. HON is up 66% in the last 6 months. The key here was to hold onto this stock during the pandemic, speaking to the discipline of holding.

stockchase.com stockchase.com

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.

General Electric (GE-N) — Stockchase
General Electric (GE-N) — Stockchase

Will it double in 2021? No, but the business is turning around. The resumption of air travel will be a tailwind. Their hospital business is doing well. It could reach $15.

stockchase.com stockchase.com

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.

Johnson Controls (JCI-N) — Stockchase
Johnson Controls (JCI-N) — Stockchase

(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.

stockchase.com stockchase.com

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.

Eaton Corp. (ETN-N) — Stockchase
Eaton Corp. (ETN-N) — Stockchase

They delivered a perfect quarter. They're doing a lot of the right things. Management has horse sense.

stockchase.com stockchase.com

Ametek (AME-N)
They manufacture electronic instruments and electromechanical devices. They make monitors for many industries, including pharma and oil. A leader in highly engineered electrical connectors.

Ametek (AME-N) — Stockchase
Ametek (AME-N) — Stockchase

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.

stockchase.com stockchase.com

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.

Anixter International (AXE-N) — Stockchase
Anixter International (AXE-N) — Stockchase

(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.

stockchase.com stockchase.com
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