3 Old-School Tech Stocks to Buy Now

We look at 3 old-school tech stocks that have been standing out amidst market weakness.
3 Old-School Tech Stocks to Buy Now
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When you stop to look at what’s been happening with technology stocks this year, it’s a tale of two markets. First, you have the growth-oriented tech stocks that have been relentlessly sold thanks to rising interest rates and questions about their valuations. These stocks were market darlings last year but haven’t exactly impressed during 2021. On the other side, you have “old-school” tech stocks with more attractive valuations that have been performing quite well so far this year. These are stocks with legacy technology that have been around for years and are clearly in favor with both investors and portfolio managers at this time.

While many of these old-school tech names don’t have the same luster and hype as the newer growth names, they still have a lot to offer long-term investors. If you’re curious about some of these legacy tech names that are performing well at the moment, keep reading on for our list of 3 old-school tech stocks to buy now.

Dell Technologies Inc (NYSE:DELL)

If you haven’t checked on this old-school tech stock for a while, you might have missed the fact that it has rallied 109% over the last year. Dell Technologies is a company that does more than simply sell computers. It’s a major manufacturer of IT hardware, software, and service solutions that span everything from traditional infrastructure to emerging cloud technologies. That means it’s a company benefitting from the massive digitalization trend in the economy which was sped up by the pandemic. More people working from home and seeking remote education tools are driving notebook demand higher while the company should continue to generate strong revenue from enterprise customers over the years as they look to upgrade their technology.

Dell’s earnings in 2020 were quite impressive, as the company reported record full-year revenue of $94.2 billion, up 2% year-over-year, along with record operating income of $5.1 billion, a 96% year-over-year increase. Keep in mind that Dell’s VMware business, which works with customers in the areas of hybrid cloud, networking and security, and digital workplaces, is growing fast and provides strong subscription and SAAS revenue for the company. With that in mind, it’s clear that Dell is one of the best old-school tech stocks to consider buying now.

International Business Machines (NYSE:IBM)

There’s a lot for investors to like about Big Blue at this time, particularly since the stock is up about 10% year-to-date. As a business with a history dating back to 1911, IBM has a storied history and has gone through plenty of changes throughout its existence. What’s exciting about the company today is that IBM is emphasizing developing its hybrid cloud and artificial intelligence businesses by spinning off the managed infrastructure business that has been a drag on the company’s growth and margins.

The move could finally get the company’s earnings heading in the right direction again, and it seems that investors are picking up on the company’s potential. The recent acquisition of open-source software provider Red Hat should help to improve IBM’s gross margins and its position in the hybrid cloud space, and the company’s new CEO Arvind Krishna is keen on revitalizing the company quickly. You also have to like the fact that the stock offers investors a 4.78% dividend yield. While IBM isn’t the most exciting tech stock, the fact that it is such a big provider of systems, services, and software that is critical to IT systems makes it a company worth considering for your portfolio, especially given how it is evolving.

Cisco (NASDAQ:CSCO)

Another surprisingly strong tech stock to consider adding at this time is Cisco, a company that is engaged in designing and selling tons of different technologies across networking, security, collaboration, applications, and the cloud. With IT spending on the rebound as workers start to head back to the office, Cisco should see its networking gear sales pick up again. The company’s business model is also set up to take advantage of customers that want to switch over to hybrid cloud computing, as Cisco offers subscription-based offerings with its HyperFlex solutions. Cisco stock has rallied over 19% year-to-date and continues to be a standout tech stock even with the weakness in the NASDAQ.

Dividend investors should also be attracted to this one, as the stock currently offers a 2.82% dividend yield. Finally, as a worldwide leader in communications equipment, Cisco should also benefit from the rollout of 5G and WiFi 6 upgrades, which is yet another reason why this is one of the best old-school tech stocks to buy now.
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