Software is at the heart of the information age and is a huge driver of enterprises. Software stocks, under the technology sector, is set to grow even more as automation, and digitization continue in the workplace. These companies produce software widely used by companies and so they grow in tandem with other sectors which utilize their technology. Here are the top 17 enterprise software stocks right now:
Open Text (OTEX-T)
A Canadian company that develops and sells enterprise information management software. They pay a 1.6% dividend. They have high free cash flow and their fundamentals are looking good. They’ve been mentioned by numerous analysts as either a top pick or a buy.
Good acquisitions. He recently sold it, because of fears of the US dollar weighing on their earnings. He regrets this, because it has since moved up 10%. He likes the company and is looking for a better entry point than the current price. A good growth company.
Shopify Inc. (SHOP-T)
A company that is considered a Canadian unicorn. They provide a computer software platform for online stores and retail point-of-sale systems. The charts look good, and their addressable market is huge. A world leader in the e-commerce space.
(A Top Pick Mar 15/19, Up 16%) He sees it continuing to press higher. He would continue to hold it as it is consolidating before an expected further push higher.
Adobe Systems (ADBE-Q)
They provide software that is ubiquitous in the digital media/creative space. It is at a high valuation right now but it is a quality business. It is heavily used in corporate America and their cloud business is growing.
The leader in creating digital media. There is enormous growth in the creation of Digital media. They used to sell their software as a package, with an upgrade every couple of years. There was an enormous number of people pirating their software. They then started selling by subscription. They caught a bunch of pirates that…
SalesForce.com Inc. (CRM-N)
An American cloud computing company that just released earnings. They’ve been consistently beating expectations. They were one off the first to offer software as a service and they’ve done very well. Their main business is for large companies and banks to interact with their clients.
Salesforce compared to Facebook and Google? Software company, trades at a high multiple, which is holding her back from buying. It’s more a momentum stock, any stumble and it will pull back. Not similar to Facebook or Google, which are advertising plays on the internet. Great company. Wait for pullback.
FireEye Inc (FEYE-Q)
An enterprise cybersecurity company that seeks to protect against cyber threats. They are a leader in security as a service and demand is growing.
This cyber-security business just reported earnings and highlighted the growth in demand for their end-product. He does own this in his portfolio.
Autodesk Inc (ADSK-Q)
A 3D design software corporation that is used by architecture, engineering, media and connected industries. They are growing and acquiring companies so it should definitely be on your watchlist for a good entry point.
Performing extremely well relative to the sector. Wait for strength to come back into the technology sector.
An American cloud computing company. Their software is used to manage workflow in companies that provide services such as IT servicing. They’re growing rapidly and was mentioned as a Top Pick by David Burrows.
Software as a service. It is the strongest sector, period – in the last two years. It makes software that is used to manage workflow such as for companies that provide IT servicing. It is growing rapidly. 35% year over year. They have running room in front of them. (Analysts’ price target is $233.32)
One of the world’s largest provider of database software. They’ve started changing their service into a subscription services and cloud based business. Their biggest client are financial institutions and are considered to not be a high risk trade.
It recently had a pretty good earnings beat. Technically, it has broken out of a cup. Right now, the water is going against tech, and this has had a phenomenal run and valuations are very high. He would suggest moving your money to another allocation. Dividend of about 1.5%.
Red Hat Inc. (RHT-N)
An American open-source software products provider that is used in the enterprise community. IBM bought them recently. They help customers transition into the Cloud, and the demand for this type of service is expected to grow as companies transition into the cloud.
A giant in computing hardware and software. They pay a nice dividend that is expected to grow. They’re an absolute leader in software and the cloud who has been consistently growing. Their office program is moving to subscription base meaning good recurring revenue with high margins. A good stock to hold.
China-US trade war is having an effect on entire tech sector. It's a bit more immune to it, but he wouldn't be stepping in front of this train. Perhaps a bit more defensive as a tech in terms of its scope.
Tableau Software, Inc. (DATA-N)
They produce interactive data visualization products focused on business intelligence. They are pioneers in data analytics and they are moving from licensing to subscriptions and are getting rewarded for it.
135.67 Big data hardware is in the cloud and data analytics. Tableau is involved in the latter--they were pioneers in this space and are now leaders. They've moved from licensing into subscriptions early and it's paid off very well.
Splunk Inc (SPLK-Q)
A software platform provider that uses a web-style interface to utilize big data. They’ve raised their 2020 revenue outlook and have returned about 21% in the last 2 months.
They take very rudimentary machine language and put it into a web based portal for whatever business you have to really monitor what you are doing.
Citrix Systems (CTXS-Q)
They are the leaders in providing a secure digital workspace in the cloud. They’ve also become the preferred and most-used solution for enterprise file synchronization and sharing (EFSS).
Cognizant Technology Solutions Corp. (CTSH-Q)
A IT services provider that helps companies implement technology. They started helping banks, insurance and healthcare generate more revenue using technology. An activist shareholder was brought in, and the company is focusing on value creation.
(Top Pick Feb 6/14, Up 29.75%) They tap into one of the only growth areas in North America. Customers are spending money on stock buybacks and reduction of costs, which is where they consult.
An on‑demand financial management and human capital management software vendor.They have brought in financial software that has helped them and analysts consider it a strong takeout target.
(A Top Pick Aug 29/18, Down 13%) A decline of this size is actually not bad (relative to others) – making it a stock he will continue to hold. Bringing in financial software has helped the company and he thinks it could be a strong takeout target.
MongoDB, Inc. (MDB-Q)
A networking software supplier. Their main clients are financial services, government, healthcare, retail and telecom companies. The financial results for the fourth quarter and full year are expected to be announced on March 13.
Great growth rates, supplying networking software. Has done gangbusters in recent years. Sold it in Q4, but still follows it. $60 price target. Very expensive now. Wants to buy it, but at lower levels.
Okta, Inc. (OKTA-Q)
A cloud software company that helps companies manage their employee passwords. Major S&P companies have embraced this company and their stock price has seen a nice return. There is still space to grow so it’s worth a look.
If they do this right, Okta can get rid of multiple passwords that every computer user has. I.T. departments of major S&P companies have embraced this company. It has seen an 76% increase in customer subscriptions and a great 67% return YTD. (Analysts price target $46.57)