Looking For The Best Software Stocks To Buy Ahead Of February?
Software stocks have been and are still flourishing in the stock market today. The reason for this lies in two words. Digital acceleration. It is no surprise that the coronavirus pandemic has virtually forced organizations and businesses towards digital acceleration. As a result, this has fueled top-line growth for the top software stocks to watch now. Because of this sudden movement, corporate spending in the software industry has gone through the roof. Key areas that have blown up are cloud services, cybersecurity, big data analytics, and digital transformation services in general. With so much movement in the sector, investors likely have their eyes peeled looking for the best software stocks for their portfolios.
I don’t blame them for doing so. For example, The Trade Desk (NASDAQ: TTD) and Magnite (NASDAQ: MGNI) have seen their shares gain by over 400% since mid-March. Understandably, the two companies provide online advertising services. But, in the bigger picture, they provide a vital service to companies in these times. Given the plethora of software companies that fulfill the same role, the industry is a booming one. Reading till this point, you may be eager to jump on the software train yourself. Well if you are, here is a list of the top software stocks to buy [or avoid] ahead of next week’s trading session.
4 Software Stocks To Watch Right Now
- BigCommerce Holdings Inc. (NASDAQ: BIGC)
- Fastly Inc. (NYSE: FSLY)
- Datadog Inc. (NASDAQ: DDOG)
- Workday Inc. (NASDAQ: WDAY)
BigCommerce Holdings Inc.
Right off the bat, we will be looking at BigCommerce. It operates a leading SaaS (Software as a Service) e-commerce platform that empowers merchants of varying sizes to grow their businesses online. It caters to a wide array of customers across numerous industries and 150 countries. Notably, BIGC stock popped by over 13% during intraday trading yesterday on its recent announcement.
BigCommerce announced that it would be reporting its financial results for its fourth quarter next month on February 18. Based on its recent-quarter fiscal, investors could be anticipating another quarter of growth from the company. In detail, the company saw a 40% year-over-year rise in total revenue. This added up to $39.7 million. BigCommerce reported that it was one of the company’s best quarters to date. On top of all that, investors could be awaiting robust gains from the holiday season.
Despite all this, BigCommerce is not resting on its laurels just yet. Earlier today, the company announced JBS Custom Software Solutions as a new partner. Through this, BigCommerce is bolstering its portfolio with JBS’s cloud-based app development expertise. As it continues to improve its array of services, do you think BIGC stock is in for big gains this year?
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Another top software stock in focus now would be cloud computing service provider Fastly. Through its proprietary edge cloud platform, Fastly powers fast, secure, and scalable digital experiences for its clients. Seeing as the general population is consuming digital content more than ever, the company appears well-positioned for growth. Likewise, FSLY stock has skyrocketed by over 320% in the past year. Naturally, this caught the eye of investors and analysts.
Investment bank Oppenheimer (NYSE: OPY) analyst Timothy Horan gave the stock a shining review. Horan gave FSLY stock an Outperform rating and set a new target price of $125 a share. This would explain why it gained by over 6% just passing the $104 mark at yesterday’s closing bell. On top of that, Horan also mentioned that Fastly could surpass Wall Street consensus estimates for its recent quarter revenue by over $1 million. Time will tell if this will be the case. If it is, FSLY stockholders would likely rejoice.
If that wasn’t enough, Fastly wowed investors with a solid performance in its recent quarter as well. The company reported a 41% year-over-year rise in total revenue which totaled $70.64 million. Additionally, it ended the quarter with $309 million in cash on hand which reflected a massive 466% jump year-over-year. Could all this make FSLY a top software stock? You tell me.
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Next up, we will be looking at cloud-monitoring SaaS company, Datadog. It offers a wide array of tools and services through its proprietary data analytics platform. As countless businesses port to the cloud, Datadog would provide key monitoring services to keep their clients’ digital assets safe. Similarly, DDOG stock is looking at gains of 256% since the pandemic hit in March. Given its current value, investors may wonder if it still has room to grow.
Looking at its recent quarter fiscal posted in November, this could be the case. Datadog reported a 61% year-over-year leap in total revenue which added to over $154 million. Furthermore, it ended the quarter with $198 million in cash on hand. CEO Olivier Pomel said, “We have maintained our strong track record of innovation and extended our leadership as the most complete and cloud-native end-to-end observability platform. We continue to make meaningful R&D investments toward what is a very significant long-term opportunity.”
Adding to that, news broke earlier this week that N2W Software will now support Datadog integration. N2W Software is a leading backup and recovery solution for Amazon (NASDAQ: AMZN) Web Services. With increased integration with other software, do you think DDOG stock is poised for more growth?
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Last but not least is Workday. The company is an on-demand financial management and human capital management software vendor. It caters to a wide variety of organizations ranging from medium-sized businesses to over 60% of the Fortune 50. Indeed, its services would be vital amidst the pandemic where offices were forced to make major shifts. For one thing, WDAY stock does reflect this as it has doubled in price since the March selloffs.
Not to mention, Workday has been hard at work lately. Last week, it launched a vaccine management solution and bolstered its existing services. The earlier solution helps customers ensure the health and safety of their remote and on-sight workers. The latter introduced the Workday Accounting Center (WAC) to existing clients. Through the WAC, Workday’s clients can manage operational and financial data from multiple sources with a single point of control across the enterprise. As Workday is firing on all cylinders, WDAY stockholders could be in for a treat.
In its recent quarter fiscal, the company even posted solid figures. Workday reported $1.1 billion in total revenue and $1.07 billion in cash on hand. CEO Aneel Bhusri said, “As we enter Q4, we are increasing our pace of investments to capitalize on the long-term opportunity that we see ahead.” Given all of this, will you be adding WDAY stock to your watchlist?