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3 Top Cloud Stocks To Watch In October; 2 Making Big Moves This Week

Looking for the best stocks to buy now? Do you have these cloud stocks on your mind?

Are These The Best Cloud Stocks To Buy Right Now?

If you wanted to make money in the stock market this year, the easiest way was to buy cloud stocks. It wouldn’t be outrageous to say that money no longer grows from the ground, but rather rains from the clouds. Even if you were skeptical before, you better start believing now. While the coronavirus pandemic has been a disaster for the stock market today, some of the top cloud stocks are showing their worth. This came as the pandemic accelerated changes in the technology industry. Social distancing measures are benefiting companies who provide various technological solutions to businesses. The momentum could continue as higher adoption led users to stick to these solutions over time. You can think of it as a “new normal” for tech.

The Nasdaq Composite has been a true performer this year, rallying over 70% since its March lows. Not only has it erased the correction caused by the pandemic, but it also made further gains. You could have guessed that cloud stocks have contributed heavily to that rally. With every business migrating online, the demand for cloud computing services exploded in mere months.

This led investors to look for top cloud stocks to buy, and Zoom (ZM Stock Report) was one of the favorites. Zoom’s offering coupled with DocuSign (DOCU Stock Report) or Adobe’s (ADBE Stock Report) Adobe Sign would make virtual business meetings a seamless experience. Just imagine, before the pandemic, you would have to fly out to conduct face-to-face meetings and to sign documents. Now, all these are made possible in the comfort of your own home. 

With no end in sight to the coronavirus pandemic, this would be a conducive environment for investors to look for the best cloud stocks to buy. After all, they aren’t negatively affected by the present economic predicament. If we have noticed one thing from the pandemic, it is that the need for cloud computing technology is becoming more pronounced than ever. If you are looking to invest in the cloud revolution this year, here are a few high-growth cloud stocks that might be worth adding to your portfolio.

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Top Cloud Stocks To Watch Right Now: Cloudflare

With more workplaces going digital, cloud computing companies that safeguard our information could be a strategic investment. Cloudflare (NET Stock Report) has been making one of the big moves in recent weeks. Cloudflare stock got a major boost yesterday with investors bidding the share 23% higher. This came after the announcement of Cloudflare One, a network-as-a-service solution for cloud-based security, performance, control through a single user interface. This is the latest step in the company’s evolution in its mission to help build a safer and better internet. 

Matthew Prince, co-founder and CEO of Cloudflare, said the following about the news pushing NET stock higher today.

“The only way to secure today’s work-from-anywhere economy is to secure each individual employee, protecting their individual networks, devices, and access to business-critical applications. With Cloudflare One, we’re giving organizations of any size the power to solve their security and networking needs seamlessly, no matter how their business needs shift.”

Cloudflare One notably integrates with major providers of identity management and device-security solutions. Some of the notable providers in the new product’s partnership ecosystem include Okta, Alphabet’s Google Workspace, Facebook, VMWare’s Carbon Black, and more. With so much growth prospects centering around Cloudflare, is NET stock a long term buy?

Top Cloud Stocks To Watch Right Now: Twilio

Shares of Twilio (TWLO Stock Report) jumped after the company said it would acquire Segment for about $3.2 billion in an all-stock deal. With such an impressive run-up in TWLO stock year-to-date, many would agree that it’s a top cloud stock to buy. The cloud services provider attracted the bulls with its robust revenue growth. And the company is not shy to capitalize on its stock price as a currency for acquisition. Investors now wonder what they can expect from TWLO stock in the final stretch of the year.

“We believe the pairing could result in a game-changing opportunity for Twilio (TWLO). Segment is a leading independent Customer Data Platform and could act as a catalyst for TWLO to enter the ring with CRM and ADBE for the battle for Customer 360,” said J. Derrick Wood, equity analyst at Cowen and Company, who gave a price target of $350.

I can’t tell what’s going to happen in the final quarter of 2020. But one thing is for sure. And that is the increased demand in technology will lead to more sales for the cloud communications platform. After all, in an increasingly interconnected world, digital communications couldn’t have been more important.

Twilio’s cloud communications platform helps businesses improve their digital interactions with their customers. Some of its major clients include Coca-Cola (KO Stock Report) and Twitter (TWTR Stock Report), just to name a few. Earlier last month, the company reported second-quarter results that exceeded Wall Street’s expectations. Total revenue was $400.8 million, up 46% year-over-year. It delivered net income of $9.5 million, or 71 cents per share. As long as Twilio stock remains in a long-term uptrend, investors may continue to buy it on dips.

[Read More] Are These The Best Stocks To Buy In Anticipation Of Another Stimulus Package?

Top Cloud Stocks To Watch Right Now: Salesforce.com

The “grown-up” on this list of cloud stocks is none other than Salesforce.com (CRM Stock Report). You could say that they made cloud mainstream. The cloud services provider reported over $5 billion in its latest quarterly revenue for the first time ever. Its billing growth accelerated. Also, their adjusted operating margin hit an all-time high. If that is not enough for investors, the company also raised guidance for the year.

Shares of Salesforce hit all-time highs following its second-quarter earnings report. But the company’s stock price was severely under pressure following the broader tech sell-off in September. If you believed the correction was a buying opportunity and acted on it, kudos to you. After all, tech stalwart has been rewarding for many shareholders. Now that it appears to be rebounding strongly, CRM stock would be worth keeping an eye on.

As Salesforce’s services automate business processes, they reduce a company’s reliance on human employees. Going forward, this is a secular trend that seems unstoppable. Demand for these services will continue to climb as companies cut expenses. And Salesforce is at the top of the customer relationship management market. That makes it a top cloud stock to watch for long-term investors.

By Adam Lawrence

Adam Lawrence is a serial entrepreneur and financial writer for StockMarket.com. He calls Miami, Florida his home but has a love for travel. He started his first digital marketing and website design business, in 2006 at the age of 23. He has worked with and consulted for hundreds of publicly traded companies. His vast knowledge of the public markets has allowed him to gain real-world experience in corporate communications. No matter what is going on in the stock market today, Adam is at the front of the line to track new trends and present them to readers.

As an active contributor to other financial sites like GuruFocus and Benzinga, Adam has gained prominence for reporting on several topics. These include biotech stocks, technology stocks, gold stocks, as well as marijuana stocks. These active stock market sectors have presented investors with some of the biggest opportunities in the stock market today. Adam's goal is to present readers with easily digestible content that is both informative and actionable.

Adam's years of experience in digital marketing have helped give him an edge above other financial writers. His ability to pick up on stock market trends before they hit Main Street is one of the things that has afforded him the opportunity to interact with and engage public companies. Reporting on current events is one thing but being able to dissect them and translate them for readers is of the utmost importance. In doing so, Adam has set a personal standard to deliver timely information that dives deeper than simple headlines and goes into the fine details of what's driving stock market trends. He also stays on top of the most current social media trends among top influencers.

With the emerging landscape surrounding new media, Adam takes an active approach to learn what drives interest in different social media and finds ways to tap into whatever is trending at that time then apply it to his approach to the stock market. In his free time, he enjoys being with his family and working on his house. He's also an avid car enthusiast.