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There are thousands of tech stocks for investors to choose from, but most tend to focus on just a handful of names. That’s understandable to some degree since companies like Apple, Microsoft and Meta Platforms generate huge profits from their global customer bases.

The good news is that stepping just outside of that small bubble of popular tech stocks can yield excellent diversification and some attractive values. Let’s look at a few of these unsung heroes that are worth placing on your investing watchlist.

1. Garmin

If you like Apple for its tech innovation, then consider owning its less-celebrated rival Garmin (NYSE: GRMN). The GPS device giant recently posted impressive earnings results, with Q3 sales rising 12% to $1.3 billion. Assisting in that boost was growth in four of Garmin’s five main product categories that span smartwatches and fitness trackers along with more complicated marine and aviation platforms. “We delivered outstanding performance in the third quarter,” Chief Executive Officer Cliff Pemble told investors in early November .

Garmin’s finances are outstanding, too. Cash flow is solidly positive and profit margin is holding above 20% of sales, not far from the peak that investors saw of roughly 25% of sales during the pandemic.

Garmin is planning to press its advantage on innovation across its GPS device niches with a packed calendar of new releases in the coming years. Investors can review a long track record of wins on this score when judging the company’s prospects. Looking further out, shareholders can expect to benefit from Garmin’s success at boosting sales and profit margins into 2024 and beyond.

2. Palo Alto Networks

You might be turned off by Microsoft’s $2.7 trillion market valuation, a reflection of its dominant presence in several huge software niches. If that describes you, consider Palo Alto Networks (NASDAQ: PANW) as a way to gain focused exposure to the cybersecurity industry .

Palo Alto Networks reported a blazing 18% sales spike for the selling period that ran through late July. Revenue was lifted by demand for more comprehensive cybersecurity solutions and for the company’s unique platform that incorporates loads of artificial intelligence (AI) tech. This niche is proving resilient even as IT managers scale back on spending in other areas, and that factor is helping propel Palo Alto Networks’ forward.

As in the case of Garmin, there’s a lot to like about this company’s financial performance as well. Palo Alto Networks reported positive earnings last year and management is determined to build on those successes in fiscal 2024 and beyond. Adjusted income — meaning not based on generally accepted accounting principles (GAAP) — should rise by about 20% this year, the company estimates, as free cash flow lands at nearly 40% of sales.

Sure, it will be many years before Palo Alto can achieve anything approaching the over 40% of sales profit margin that Microsoft routinely generates. But the software-as-a-service specialist has a good shot at lifting margins into the double-digit percentages, potentially by 2025. That’s a growth story that many shareholders will enjoy watching as the cybersecurity industry continues expanding in the coming years.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Demitri Kalogeropoulos has positions in Apple and Meta Platforms. The Motley Fool has positions in and recommends Apple, Garmin, Meta Platforms, Microsoft, and Palo Alto Networks. The Motley Fool has a disclosure policy.

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