By now, you’ve heard of the Internet of Things (IoT) — or the network of physical devices, vehicles and other things embedded with sensors, software and network connectivity, which allows them to collect and share data. That includes smart thermostats, smartwatches, vehicles and industrial machines to name a few. There have even been calls for “smart cities” based on IoT. All of which is a catalyst for some of the top IoT stocks.
Plus, according to IBM (NYSE:IBM), “The number of IoT devices is expected to continue to grow rapidly, with estimates suggesting that there will be tens of billion IoT devices in use over the next few years. This growth will be driven by increased adoption across industries, as well as the development of new use cases and applications.”
“Artificial intelligence and machine learning are becoming increasingly important for IoT, as they can be used to analyze vast amounts of data that is generated by IoT devices and extract meaningful insights. This can help businesses make more informed decisions and optimize their operations,” they added.
No wonder the market could be worth about $3.37 trillion by 2031, according to analysts at SNS Insider. Even better, here are some of the top IoT stocks that should thrive on the growth.
Samsara (IOT)
After finding strong double-bottom support $30, Samsara (NYSE:IOT) is back to $36.82. From here, I’d like to see it retest its high of about $40 initially, as it continues with its strong uptrend.
Helping, analysts at Loop Capital just initiated a buy rating on the stock with a $42 price target. All thanks to its exposure to artificial intelligence, machine learning and IoT. Additionally, its technology allows it to be supportive of “nearly endless” use cases, implying that Samsara’s total addressable market has few constraints, added the firm, as noted by Seeking Alpha.
Most recently, IOT announced a collaboration with logistics and transportation company TMS to help improve the safety of drivers and operators, while reducing accidents.
“As part of this partnership, TMS will integrate Samsara’s AI Dash Cams into its comprehensive security program. These cameras will provide real-time in-cab alerts as well as the ability to retrieve video on demand, allowing TMS to reduce mobile device use while driving and easily exonerate non-at-fault drivers in the event of incidents,” as noted in the press release.
Global X Internet of Things ETF (SNSR)
We can also look at IoT-related exchange traded funds (ETFs) such as the Global X Internet of Things ETF(NASDAQ:SNSR). Since bottoming out at around $28 in late 2023, the ETF ran to about $37. Now at $34.77, it’s still a strong opportunity.
With an expense ratio of 0.68%, the SNSR ETF holds 53 stocks that could benefit from “broader adoption of the Internet of Things (IoT), as enabled by technologies such as WiFi, 5G telecommunications infrastructure, and fiber optics,” as noted by Global X ETFs.
“This includes the development and manufacturing of semiconductors and sensors, integrated products and solutions, and applications serving smart grids, smart homes, connected cars, and the industrial internet,” they added.
Some of its top holdings include Garmin (NYSE:GRMN), DexCom (NASDAQ:DXCM), STMicroelectronics (NYSE:STM), Lattice Semiconductor (NASDAQ:LSCC) and Qualcomm (NASDAQ:QCOM) to name a few. What’s nice about the SNSR ETF is that we can buy 100 shares for about $3,477 and gain exposure to 45 stocks.
Aptiv (APTV)
There’s also beaten-down, oversold shares of Aptiv (NYSE:APTV), which exploded on Thursday.
The global technology company develops connected solutions enabling a more sustainable future of mobility. It just saw its stock pop about $8 on earnings. While its adjusted earnings per share of $1.16 beat estimates for $1.01, revenues of $4.901 billion missed expectations of $5.008 billion.
“Aptiv delivered solid results in the first quarter with 200 basis points of margin expansion year-over-year and a return to growth above market, despite a slowdown in electrification in North America and Europe and persistent labor and material cost headwinds,” said Kevin Clark, chairman and chief executive officer in a company press release.
The company also raised its fiscal year 2024 adjusted EPS outlook to a range of $5.80 to $6.30, as compared the estimates calling for $5.75. However, it did lower its revenue outlook to a new range of $20.85 billion to $20.45 billion, which is below estimates for $21.57 billion.
Fortunately, as we begin to see some improvement in global electric vehicle sales, Aptiv’s numbers should start to come back strong.
On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.