Is NCR Atleos Corporation (NATL) the Best Small Cap Tech Stock to Buy Now?
We recently published a list of . In this article, we are going to take a look at where NCR Atleos Corporation (NYSE:NATL) stands against other best small cap tech stocks to buy now.
The S&P Small Cap 600, whose components have an average market capitalization of $3 billion, is down 11% from its record closing high set late last year. A number of connected issues have pushed the market lower, including President Trump's tariffs, which would raise the cost of importing hundreds of billions of dollars in products, reducing profit margins at firms that can't raise prices enough to offset the costs. Higher prices will boost inflation, suggesting that the Federal Reserve may raise interest rates rather than cut borrowing costs, putting more strain on the economy. These trends disproportionately affect small cap stocks since they usually can't come up with as many cost-cutting options as their larger competitors, which means declining sales significantly impact profit margins. On the other hand, some analysts believe small companies may profit from Trump's plans, notably decreased restrictions, and support for local sectors because small enterprises are more US-focused than global corporations.
Looking ahead, RBC Capital believes that the current year may be a watershed moment for small caps. The Federal Reserve's effort to cut interest rates may encourage companies to take greater risks, thus increasing M&A and IPO activity. As conditions improve, small caps may begin to close the gap between their large cap competition.
The rapid expansion of artificial intelligence (AI) continues to transform sectors throughout the world, and experts are keenly watching its effects on the broader US stock market. Morningstar, reviewing the US market in 2024, stated the following on January 3:
'Out of the 24.09 percentage points gained by the US Market Index in 2024, 13.2 came from just eight stocks, which are mainly seen as benefiting from artificial intelligence technologies: Nvidia, Apple, Amazon.com, Meta Platforms, Tesla, Broadcom, Microsoft, and Alphabet. In other words, 55 percent of total market gains in 2024 can be attributed to these companies. These same companies contributed 53 percent of total market gains in 2023.'
UBS further stated that AI has and will continue to fuel the expansion of the larger technology sector. According to the bank, following the implementation of ChatGPT in November 2022, the total market valuation of companies listed on the NASDAQ exchange climbed to around $13.5 trillion.
On the other side, some are questioning the current condition of the AI business. Sky-high valuations were one of the primary reasons why AI stocks were struck so hard by the tariff sell-off. That said, the AI trade had already lost pace before Trump's tariffs rattled the global stock market. Concerns over overspending on AI infrastructure and competition from Chinese rivals caused the AI rally to stop in late January and early February. UBS analysts, however, are optimistic that the current sell-off will be comparable to the one that occurred in 2018. The analysts said that today's tech dip is similar to the one that occurred during Trump's first term when geopolitics and 'fundamentals-related noise' momentarily muddled investors' assessment of an otherwise decent future.
For our list of the best small cap tech stocks to buy, we used finviz and looked at firms in the technology sector with market capitalizations ranging from $200 million to $2 billion. Using Insider Monkey's hedge fund data for Q4 2024, we ranked these companies in increasing order of the number of hedge funds that own a position in them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points ().
A person using a laptop to access a bank's online banking system.
Number of Hedge Fund Holders: 30
Market Capitalization: $1.84 billion
NCR Atleos Corporation (NYSE:NATL) is a financial technology firm that offers self-service banking applications, ATM networks, and managed network services. It operates in North America, Europe, and Asia Pacific, with a customer base that includes financial institutions, merchants, and businesses.
On March 11, DA Davidson analyst Matt Summerville maintained a Buy rating on NCR Atleos Corporation (NYSE:NATL) with a $60 price target, citing confidence in the company's performance and future. Summerville's analysis revealed success in the Self-Service Banking (SSB) category, including an increase in ATM as a Service (ATMaaS), service-led market share gains, and a continuing hardware refresh cycle.
Despite certain obstacles, including a relative weakness in Europe and persistent softness in LibertyX operations, NCR Atleos' overall execution has been strong, with key performance indicators in both the SSB and Network sectors pointing towards positive trends. The company's financial record confirms this, with revenue of $4.3 billion in the previous year and an EBITDA of $832 million.
Overall, NATL ranks 7th on our list of best small cap tech stocks to buy now. While we acknowledge the potential of NATL as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NATL but that trades at less than 5 times its earnings, check out our report about the .
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
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LIKEWISE, WE WILL PROVIDE TO CHINA WHAT WAS AGREED TO, INCLUDING CHINESE STUDENTS USING OUR COLLEGES AND UNIVERSITIES (WHICH HAS ALWAYS BEEN GOOD WITH ME!). WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%. RELATIONSHIP IS EXCELLENT! THANK YOU FOR YOUR ATTENTION TO THIS MATTER!" A variety of market observers quickly weighed in hours after Tuesday evening's unveiling to suggest that the deal may not have a lot of meat on the bones — but at least relations are no longer moving in the wrong direction. The talks perhaps underscored how unlikely a comprehensive trade deal is anytime soon, noted AGF Investments Greg Valliere, "but at least relations may not worsen as talks continue throughout the summer." Both sides promised additional talks in the weeks or months ahead, but none have yet been scheduled. Veronique de Rugy, a professor at the Mercatus Center at George Mason University, suggested the talks continued to show China's leverage. "China is hurting, yes—but they still hold the upper hand on critical resources, and they know how to use them." Any lessening of tensions — and freer flow — of these mineral resources in China would be a significant boost to the global economy with China holding outsized leverage in both the reserves and processing capacity of these key building blocks for everything from computers to electric vehicle batteries to medical devices. Likewise, the US offering concessions on export controls would be a significant move after years where successive US administrations have wielded these controls — especially around the design and manufacture of semiconductors — by saying they need to be tight on China for national security reasons. Read more here. May's Consumer Price Index (CPI) report will be released on Wednesday and its expected to show that prices rose a bit faster than in April. Yahoo Finance's Allie Canal breaks down what to look out for and how President Trump's tariffs are impacting what consumers are now paying for goods and services. Read more here. Now that the US-China trade truce is back on track, both sides are keen to ensure it stays that way. China's Vice Premier He Lifeng said both sides need to now 'show the spirit of good faith in abiding by their commitments and jointly safeguard the hard-won results of the dialogue.' Bloomberg News reports: Read more here. Reuters reports: Read more here. Despite the US-China trade truce resuming the pain from President Trump's tariffs remains in China, especially among small exporters. Reuters reports: Read more here. Japan warned Wednesday that tariffs threaten its economic growth, the government said in a monthly report. Reuters reports: Read more here. Reuters reports: Read more here. Reuters reports: Read more here. 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'Now we can go forward to try to do positive trade, growing trade,' he said. As part of the deal, Beijing has promised to speed up shipments of rare earth metals, a crucial component for global auto and defense industries. Washington will ease export controls. This marks the first sign of movement on key issues. The proposal will now be presented to President Trump and China's Xi. Still, the discussions also did little to resolve a long-standing issue: China's trade surplus with the US. 'Markets will likely welcome the shift from confrontation to coordination,' said Charu Chanana, chief investment strategist at Saxo Markets. 'We're not out of the woods yet — it's up to Trump and Xi to approve and enforce the deal.' The meeting was set up after a phone call between the two leaders, following weeks of each side accusing the other of breaking the Geneva commitments. Both countries had used chips, rare earths, student visas and ethane as bargaining tools. Josef Gregory Mahoney, a professor at East China Normal University, said trust, not money, has been the biggest casualty of the trade war. 'We've heard a lot about frameworks,' he said. 'But the fundamental issue remains: Chips versus rare earths. Everything else is a peacock dance.' Bloomberg reports: Read more here. Sign in to access your portfolio
