Investor sentiment is shifting as concerns grow around the valuations of large US technology firms. In response, many are turning their attention to overlooked opportunities in the UK tech sector. A combination of more attractive valuations, sector-specific innovation, and growth potential is drawing investors to UK-listed technology stocks.
Among those gaining attention are Cerillion plc, itim Group plc, Tern plc, and CyanConnode Holdings Ltd, each positioned in different areas of the technology market but benefiting from renewed interest in UK-based innovation.
Cerillion plc (LON:CER)
Cerillion provides billing, charging, and customer relationship management software, primarily for the telecommunications sector. The company reported strong financial results for the fiscal year ending 30 September 2024, with revenue up 12% to £43.8 million and adjusted pre-tax profit rising 18% to £19.8 million.
Despite this performance, its share price recently declined 13% over a three-month period, leading some to see it as undervalued and a potential opportunity for value-focused investors.
itim Group plc (LON:ITIM)
itim Group develops SaaS solutions to help store-based retailers compete more effectively with online competitors. Its technology, underpinned by artificial intelligence, focuses on price optimisation, stock control, and supplier collaboration.
With physical retailers continuing to digitise their operations, itim Group’s offering is well positioned to support that transition and attract institutional interest.
Tern plc (LON:TERN)
Tern is a technology investment company with a particular focus on the Internet of Things (IoT). Rather than offering a single product or service, Tern gives investors exposure to a portfolio of innovative private IoT firms.
Its strategy is to identify early-stage companies with scalable business models and to support them as they expand, providing potential upside across multiple holdings.
CyanConnode Holdings Ltd (LON:CYAN)
CyanConnode is a specialist in narrowband RF mesh networking, used predominantly in smart metering and IoT systems. The company is active in several large-scale deployments, particularly in India.
A recent £5 million unsecured loan facility from an existing investor has strengthened its balance sheet and will support ongoing rollout and project delivery. This backing signals confidence in the company’s direction and prospects.
The renewed focus on UK technology stocks comes as part of a broader trend of rebalancing away from high-growth, high-valuation US tech names. UK companies like Cerillion, itim Group, Tern, and CyanConnode offer differentiated technology and, in some cases, more grounded valuations.
For investors seeking alternatives with strong growth narratives, the UK tech sector may present an underappreciated opportunity.
