Transformative Growth
Artificial intelligence (AI) stocks have surged spectacularly for over a year, riding the waves of a burgeoning market size. The AI dominion remains unstoppable, with Goldman Sachs heralding a forthcoming rush of four distinct AI adoption phases.
Recently, KeyBanc spotlighted enterprise software stocks prepped for monetizing AI and leveraging cloud efficiency. For investors seeking stocks poised for AI-driven advancement, here are five software gems validated by Wall Street.
Software Stock #1: Sprout Social
Sprout Social (SPT) unfurls a social media management software realm for businesses. With a $3.4 billion market cap, Sprout weaves its magic in managing social media footprints across platforms. Despite a modest 3.5% YTD dip, analysts extol Sprout’s prime spot in social media domain and AI infusion igniting its operations.
An “Strong Buy” rating colors Sprout’s canvas, with analysts painting a mean target price of $72.82, flagging a potential 22.7% uptick. Out of 13 analysts, 11 shout “Strong Buy,” 1 chants “Moderate Buy,” and 1 echoes “Hold.”
Software Stock #2: Monday.com
Born in 2014 in Tel Aviv, Israel, Monday.com (MNDY) unveils a cloud-based work operating system, nurturing project management, collaboration, and workflow automation. With an $11 billion market cap, Monday.com’s YTD 21.3% surge echoes pricing winds propelling efficient growth.
Monday.com shines luminously in analysts’ eyes with a “Strong Buy” label and a mean target price of $239.43 – forecasting a 5% elevation. Among 16 analysts, 12 chant “Strong Buy,” 2 resonate “Moderate Buy,” and 2 reverberate “Hold.”
Software Stock #3: Microsoft
Microsoft (MSFT), a tech behemoth entrenched in AI metaverse, needs no introduction. Unveiled in 1975, MSFT spans product and service galaxies, reigning as the world’s most valuable public entity with a $3.19 trillion market cap.
A 12.5% YTD boon drives MSFT’s sails, anchored by KeyBanc’s optimism brimming from multiple AI monetizing avenues. Anointed with a “Strong Buy” halo, MSFT eyes a mean target price of $446.35, projecting a 5.5% rise. Of 37 analysts, 33 trumpet “Strong Buy,” 3 cheer “Moderate Buy,” and 1 quietly endorses “Hold.”
Software Stock #4: ServiceNow
Established in 2003, ServiceNow (NOW) orchestrates a cloud symphony, harmonizing digital workflows for business operations. With a $158.7 billion market cap, ServiceNow orchestrates task automation, efficiency boosts, and IT service management streamlining.
Despite a 9.2% YTD crescendo, ServiceNow’s AI monetization flair tantalizes investors, mirroring its efficient charm.
Unearthing Gems: SAP Stock Analysis
The Tech Giant: SAP
SAP, the German tech behemoth, shines brightly in the realm of enterprise application software. Boasting offerings in enterprise resource planning (ERP), customer relationship management (CRM), database management, cloud solutions, and experience management, SAP is a colossus in the European tech landscape.
With a sturdy market cap of $230.4 billion, SAP’s stock has been a star performer this year, boasting a 26.8% increase on a year-to-date basis.
Driving Forces
KeyBanc, a discerning voice in the financial sphere, underlined SAP’s robust free cash flow generation and its seamless transition to the cloud as pivotal factors expected to propel the company’s stock price upwards. These compelling drivers are akin to a strong tailwind, pushing SAP towards greater heights.
Analyst Sentiment
Analysts are singing in harmony with a consensus “Strong Buy” rating for SAP stock. Despite this bullish sentiment, the stock is hovering close to the mean target price of the analyst cohort standing at $196.20. However, a tantalizing Street-high target price of $230 paints a picture of a potential upside of approximately 17.3% from current levels. Among the 15 analysts casting their gaze upon SAP, 11 have bestowed a “Strong Buy” rating, while 1 opts for a “Moderate Buy” rating, and 3 see it as a “Hold”.
