Technology stocks have not been an abundant hunting ground for investors over the past year as the aggressive stance of the Federal Reserve, a global economic slowdown and fears of an impending recession brought down companies in this once high-flying sector. But there are some names that bucked the trend and saw strong price increases recently.

Shares of Applied materials (AMAT 2.50%) and Check Point Software Technologies (CHKP 1.81%) has gained impressive momentum in the past three months. Their profits are greater than the Nasdaq-100 index significantly during this period. Let’s take a look at the reasons why these two Nasdaq stocks are worth buying right now.

1. Applied materials

Applied Materials shares are up 47% in the past three months. That might seem a little surprising given the softness in the semiconductor market that has weighed heavily on some big names in this space. Market research agency Gartner estimates semiconductor sales could fall 3.6% to $596 billion in 2023, after rising 4% in 2022.

This should be bad news for Applied Materials, which supplies semiconductor manufacturing equipment to foundries that make chips. More specific, Samsung, Taiwanese semiconductor manufacturing (popularly known as TSMC), and Intel together accounted for 42% of Applied Materials’ total sales in the past fiscal year. TSMC was the largest customer with 20% of sales.

But a closer look suggests that Applied Materials could beat weakness in the semiconductor market. That’s because the company is on a record backlog of orders, which it believes will help it overcome any decline in wafer fabrication equipment spending in 2023. Applied Materials management said it generated “strong orders in the fourth quarter [of fiscal 2022] and ended the year with a record backlog.” Specifically, the company ended the fiscal year with a $19 billion backlog, an increase of 62% over the prior year.

Unsurprisingly, the backlog continues to grow thanks to a jump in customer spending. For example, last month TSMC announced plans to build a second semiconductor manufacturing facility in Arizona. In total, TSMC will spend $40 billion to establish its manufacturing operations in the US. Meanwhile, Samsung also seems in no mood to scale back its capital spending as the South Korean company goes after a larger share of the memory-chip market.

These companies form a significant portion of Applied Materials’ customer base, allowing them to deliver a positive surprise to the company in the current fiscal year. Analysts expect Applied Materials revenue to decline 6% in fiscal 2023 to $24 billion, but there are reasons to believe that this semiconductor stock could do better and continue its impressive rally.

In addition, investors can buy Applied Materials at a cheap price of 15 times trailing earnings, which is a discount to the Nasdaq 100 multiple of 25. They may not want to miss this opportunity given the company’s massive backlog and hefty capital expenditures by its customers.

2. Check Point Software Technologies

Cybersecurity specialist Check Point Software saw its share price rise 15% over the past three months thanks to impressive quarterly results released in November. Demand for Check Point’s offerings remained robust despite growing spending on cybersecurity solutions, as evidenced by the company’s performance in the first nine months of 2022.

Sales increased 8% year over year to $1.69 billion in the first three quarters of 2022. Its fourth quarter revenue expectation of $633 million at the midpoint suggests it is on track to finish the year with $2.32 billion in revenue, which would be a 7% increase from 2021.

But it shouldn’t be surprising to see Check Point show stronger growth as deferred revenue grew faster than revenue. The company had $1.65 billion in deferred revenue at the end of the third quarter, up 13% year over year.

Deferred revenue is the money collected up front by a company rather than services that will be provided later. So the faster growth of this metric compared to actual revenue suggests that customers are purchasing more cybersecurity subscriptions.

As it turns out, Check Point’s product and security subscription revenue grew 13% in the third quarter of 2022, its third consecutive quarter of double-digit growth. With product and security subscriptions accounting for 60% of the company’s revenue last quarter, a stronger contribution from this segment could accelerate Check Point’s growth.

The cybersecurity market is facing another year of solid increases. Gartner estimates an 11.3% increase in spending by 2023 to $188 billion.

As such, Check Point’s steady growth should continue this year, and that could help this cybersecurity stock maintain its momentum. And given that it trades at 15 times future earnings, it’s not too late for investors to buy this Nasdaq stock and take advantage of the potential upside.

Harsh Chauhan has no position in any of the listed stocks. The Motley Fool has positions in and recommends Applied Materials, Check Point Software Technologies, Intel and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Gartner recommending the following options: long January 2023 calls $57.50 on Intel, long January 2025 calls $45 on Intel, and short January 2025 $45 puts on Intel. The Motley Fool has a disclosure policy.