2 Cheap Tech Stocks to Buy Right Now

By Anders Bylund – Jan 22, 2026 at 7:13AM ESTKey PointsDuolingo has nearly 130 million monthly active users but trades at just 20 times free cash flow.Kyndryl's hyperscaler revenue doubled year over year while margins expanded to 17.2%, and the stock is dirt cheap.Neither company is broken; both are out of favor and trading at bargain valuations.CEO says this is worth 18 Nvidias. Will this make the world's first trillionaire? ›NASDAQ: DUOLDuolingoMarket Cap$6.8BToday's Changeangle-down(-1.19%) $1.77Current Price$146.81Price as of January 21, 2026 at 4:00 PM ETSome beaten-down tech stocks are broken. These two are just misunderstood.If you're hunting for cheap tech stocks, you might be tempted to bottom-fish among the wreckage of last year's highflyers. But you should resist that urge. Instead, take a closer look at two companies that aren't broken; they're just out of favor. One is helping enterprises modernize mission-critical IT infrastructure at a time when cloud and artificial intelligence (AI) adoption are accelerating. The other has built a sticky, gamified platform with nearly 130 million engaged users and strong profits (perhaps too strong for some investors, even). For some reason, neither stock is getting much love on Wall Street right now. Both deserve a closer look. ExpandNASDAQ: DUOLDuolingoToday's Change(-1.19%) $-1.77Current Price$146.81Key Data PointsMarket Cap$6.8BDay's Range$142.10 - $149.6952wk Range$142.10 - $544.93Volume2.5KAvg Vol2MGross Margin71.39% Duolingo's green owl is perched on a gold mine If Duolingo (DUOL 1.19%) were a video-streaming service, it'd be a big one. It would also be a surprisingly profitable one. With 128 million monthly active users (MAUs) in November's Q3 2025 report, Duolingo's language-learning platform is comparable to 100 million MAUs for Fox's (FOX +0.51%) Tubi and 145 million members of the Roku (ROKU +1.47%) Channel. Those are the two top names in free, ad-supported video streaming.Advertisement I'm comparing Duolingo to the media-streaming industry to highlight the massive opportunity that lies ahead. The company's large user base chiefly uses the ad-supported, free version of Duolingo. Only 11.5 million people have moved up to the two subscription plans, Duolingo Super or Duolingo Max. Ad-based online services carry notoriously slim profit margins, and often lose money in their quest for optimal user growth. Image source: Getty Images. But Duolingo is turning serious profits even with this ad-heavy user group. After backing out a one-time tax benefit from Q3's net income, Duolingo showed $70 million of adjusted bottom-line profits on $272 million in revenue. Free cash flow was even richer, landing at $77.4 million. The results were so strong, management said they would prioritize user growth over profits for a while. 2026 will see course upgrades like high school-level math and better AI-powered video calls for beginners in nine popular languages. The chess course added player-vs-player action last month. These improvements may not be cheap to develop and maintain, but they should give Duolingo's users a better experience. Management is betting that a better product sells itself. The "free" part of word-of-mouth growth just costs years of development upfront. So Duolingo's stock plunged on this strategy shift. As of this writing on Jan. 20, the stock has fallen 57% in the past six months. It trades at just 20 times free cash flow and 7.2 times sales. In other words, Duolingo's stock was dumped in Wall Street's bargain bin for the not-so-heinous crime of building a better user experience instead of maximizing short-term profits. That's a buying signal in my book, no matter the language. ExpandNYSE: KDKyndrylToday's Change(1.07%) $0.26Current Price$24.59Key Data PointsMarket Cap$5.6BDay's Range$24.34 - $24.8752wk Range$23.28 - $44.20Volume1Avg Vol2.2MGross Margin21.50% Kyndryl is the AI pick no one's talking about Kyndryl (KD +1.07%) is nobody's idea of a sexy stock. No owl mascot. No gamification. Just a bunch of IT infrastructure nerds helping Fortune 500 companies migrate to the cloud without breaking everything. It's an IBM spinoff, which sounds like a warning label. But here's what's actually happening: Kyndryl has been dumping low-margin legacy contracts like bad habits and pivoting to higher-value work. The Q2 report in November showed the results. Hyperscaler revenue doubled over the past year. Kyndryl's adjusted EBITDA margin hit 17.2%, up from 14.1% two years earlier. The company is poised for revenue growth again, tapping into the ongoing AI boom. Paired with that tasty margin expansion, Kyndryl's refreshed top-line growth should inspire more stock-picker interest and higher share prices over time. The stock? Down 37% in the past six months. Kyndryl shares are trading at rock-bottom multiples, no matter how you slice them: Metric Kyndryl's Multiple Price to earnings (TTM) 14.4 Forward P/E 6.8 Price to sales 0.4 Price to earnings to growth (PEG) 0.12 Data gathered from Finviz.com on Jan. 20, 2026. TTM = trailing 12 months. These numbers are brutal, unless you're a value investor. Wall Street still treats Kyndryl like yesterday's news. But someone has to do the unglamorous work of actually implementing all those AI and cloud projects enterprises keep announcing. Kyndryl is that someone. The market just hasn't noticed yet.Read NextJan 21, 2026 •By Anders Bylund2 Leading Tech Stocks to Buy in 2026Jan 12, 2026 •By Anthony Di Pizio1 Magnificent Growth Stock Down 67% You'll Regret Not Buying on the Dip in 2026, According to Wall StreetDec 20, 2025 •By John Ballard1 Reason Duolingo Stock Could Surprise Investors in 2026Nov 21, 2025 •By Anders BylundWhere Will Duolingo Be in 1 Year?Nov 12, 2025 •By Neil RozenbaumDuolingo Stock Is Plummeting. Is It an Opportunity or a Value Trap?Nov 10, 2025 •By Anthony Di PizioThis Magnificent Artificial Intelligence (AI) Stock Was Expensive 6 Months Ago, but Now It Might Be a Screaming BuyAbout the AuthorAnders Bylund is a contributing Motley Fool media and technology analyst covering semiconductors, cloud computing, internet infrastructure, quantum computing, and streaming media. Previously, Anders was a systems administrator for Nielsen Technology and CSX, gaining hands-on experience with enterprise-class systems. He was also a freelance writer for Ars Technica, TIME, USA Today, CNN, WIRED, and AOL's Daily Finance. He holds a bachelor’s degree in English and a master’s degree in library and information sciences from Florida State University. He believes in coyotes and time as an abstract.TMFZahrimX@TMFZahrimStocks MentionedDuolingoNASDAQ: DUOL$146.81 (0.01%) $1.77International Business MachinesNYSE: IBM$297.54 (+0.02%) $+6.19RokuNASDAQ: ROKU$104.26 (+0.01%) $+1.51FoxNASDAQ: FOX$65.47 (+0.01%) $+0.33KyndrylNYSE: KD$24.59 (+0.01%) $+0.26*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.Advertisement