Investors should stay focused on the long-term potential, not just stock price performance over the course of a year or two. Nevertheless, this long-term secular growth trend is poised to remain intact for the next decade and beyond. The software industry has not just weathered the pandemic-driven disruptions of the past few years, it has flourished. The industry is expected to continue to witness solid demand due to digital adoption, increasing automation, and demand for cloud services. DOCN was founded in 2012, and is an up-and-comer in the cloud computing space. To be more specific, DigitalOcean offers a cloud computing platform for developers, start-ups and small-to-medium size businesses.
Zoom is poised to continue on as a basic necessity of corporate communications services long after pandemic restrictions end. SPLK’s revenue is expected to rise 7.8% year-over-year to $726.79 million during the fiscal first quarter that ended April 2023. Additionally, it has topped consensus EPS and revenue estimates in each of the trailing four quarters. SPLK’s trailing-12-month gross profit margin of 77.67% is 53.7% higher than the 50.54% industry average.
Needham consumer E-commerce analyst to hold analyst/industry conference call Consumer/E-Commerce Analysts, along with Russell Saks, a Shopify Plus merchant since 2016 and Ted Starkman, Co-Founder of 50-person… Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. It’s also a unified service that helps content creators collaborate with one another remotely, deploy their apps, market them, and manage them in real time. The deal was voted down by Five9 shareholders, but Zoom nonetheless announced its own product on this front and called it Video Engagement Center. Clearly Zoom is eyeing a bigger piece of the massive global telecom industry by going after large business communications accounts.
And all of the names featured here are well-liked by the analyst community. These cloud computing companies are contributing to the future of cloud service technology. Get the most updated comparison by key indicators and discover each stock’s price target as well as recommendations by top Wall Street experts. As such, Shopify occupies an important place on this list of the best cloud stocks for 2022. «Shopify is well positioned as the leading cloud-based commerce platform,» says Baird analyst Colin Sebastian .
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That’s good enough for an overall Strong Buy rating on ADBE from Koyfin. And with thousands more merchants integrating into Shopify’s Facebook, Instagram and Google channels, the company saw year-over-year total revenue growth of 65.6% in the first nine months of 2021. And when a company has made the list for nine consecutive years, that’s worth noting. Koyfin’s surveys also reveal a 16.1% 12-month return potential for HPE, based on analysts’ average price target of $17.50. And on top of that, the company currently pays a 2.9% dividend yield – more than double the yield of the S&P 500.
The company specializes in multilayer network switches, which are needed for software-defined networking – an important component of cloud computing. ANET’s client list includes a roster of internet companies, service providers, financial services organizations, government agencies, entertainment companies and more. As is the case with all high-growth stocks, though, investing in cloud companies will have bumps in the road.
NOW’s revenue is expected to increase 21.2% year-over-year to $2.09 billion during the fiscal first quarter that ended March 2023. Its EPS is expected to increase 18.5% year-over-year to $2.05 for the same quarter. Additionally, it has topped consensus EPS estimates in each of the trailing four quarters, which is impressive. NOW’s trailing-12-month net income margin of 4.49% is 66.8% higher than the 2.69% industry average.
To visualize the internet cloud, think of warehouse-sized data centers packed with computer servers and data storage systems. Since the fund launched in early 2019, GlobalX’s cloud ETF has outperformed First Trust’s offering due to its more narrow focus on just 33 stocks, most of which are software companies. The fund is smaller, with less than $2 billion in assets under management.
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On February 27, NOW and AT&T Inc. announced a global telecom product to help communications service providers manage 5G and fiber network inventory. Of the 10 analysts surveyed by Koyfin, three consider the stock a Strong Buy, five call it a Buy and only two think it’s a Hold. Not one of the analysts surveyed considers the stock a Sell or Strong Sell.
Get Started Learn how you can make more money with IBD’s investing tools, top-performing stock lists, and educational content. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Investing in Internet of Things Stocks Learn to make money by investing in internet of things companies. Investing in Cybersecurity Stocks This tech sector addresses a growing need, presenting tremendous upside.
«Our momentum is strong as we enter fiscal year 2022 with a strategy more relevant to customers than ever before and a sharp focus on execution,» added Neri. Plus, according to Koyfin’s surveys, four analysts rate this stock a Strong Buy, seven a Buy, 11 a Hold and only one a Strong Sell. That’s enough for Koyfin to consider this stock an overall Buy.
In addition, CEO Shantanu Narayen, in the company’s earnings call, says he believes Adobe has an «immense market opportunity.» And that 2022’s targets «demonstrate the strength of the underlying business.» Four analysts rate it a Strong Buy, nine say it’s a Buy, eight rate it a Hold, and only two have it a Strong Sell. For starters, the company has an overall Buy rating from Koyfin’s survey of 24 analysts. That includes five Strong Buy ratings, eight Buy ratings, nine Hold ratings, one Sell and one Strong Sell.
Unity, which had its IPO in 2020, is a leading real-time 3D content creation platform. Millions of creators use its software, and billions of users download apps built with Unity every year. Year-to-date, NOW has gained 20.45%, versus a 8.11% rise in the benchmark S&P 500 index during the same period. SPLK’s forward non-GAAP PEG multiple of 0.49 is 70.3% lower than the industry average of 1.67. NOW’s forward non-GAAP PEG multiple of 1.57 is 6.1% lower than the industry average of 1.67. Cloud computing as an industry is only 15 years old, and can be traced back to when Eric Schmidt, then-CEO of Google, introduced the term at an industry conference.
Recent Analysts Ratings of Cloud & Storage Stocks
In 2018, it acquired small firms Marketo and Magento to bolster its position as a partner for e-commerce companies. In late 2020, it purchased Workfront to add workflow and project management solutions to its arsenal. Most recently, Adobe took over video editing collaboration software firm Frame.io. Highly profitable and investing heavily to maximize expansion, Salesforce could realize founder and CEO Marc Benioff’s goal of becoming one of the world’s largest technology companies within the next decade. It is ranked #5 out of 23 stocks in the Software — SAAS industry.
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As for that guidance, Adobe expects fiscal first-quarter revenue of roughly $4.2 billion and fiscal 2022 revenue of around $17.9 billion – both higher on a year-over-year basis. Plus, CFRA Research analyst John Freeman, who maintained a Strong Buy on the stock after earnings, said «management tends to be particularly conservative when giving initial guidance for an upcoming year.» In the company’s fiscal fourth quarter, HPE’s GreenLake orders were up 46% year-over-year and its as-a-service annualized revenue run-rate rose 36% from the year prior. Of course, with regard to cloud computing, HPE offers GreenLake Cloud Services. These provide HPE’s clients with an on-demand IT infrastructure to be used for machine learning , big data, private cloud, data protection and more. This means, of course, that cloud stocks might have even more to offer investors as the years go on.
«Annual run-rate revenue increased sharply throughout 2021, and the company’s revenue growth has accelerated throughout the year,» say William Blair analysts Jim Breen and Erik Rayner . «We expect the company to sustain a 30%-plus growth rate in 2022 with multiple levers to drive growth going forward.» Despite massive internet growth in the past decade, just over half of marketing spending takes place in a digital format. Digital ads will continue to be a fast-growing industry in the next decade — especially in at-home entertainment as TV and movies move to an on-demand internet streaming format. Veeva’s revenue has steadily grown at a double-digit percentage rate for years.
SentinelOne initiated with an Overweight at Stephens Stephens analyst Brian Colley initiated coverage of SentinelOne with an Overweight rating and $22 price target. Get instant access to more trading ideas, exclusive stock lists and IBD proprietary ratings for only $5. Investing in SaaS Stocks Software as a service has been a growth driver in the tech industry. While it isn’t a serial acquirer like Salesforce, Adobe has made some big moves to round out its software suite.
Analysts’ estimates, recommendations and price targets as of Dec. 20, 2021, courtesy of Koyfin. Alphabet Class C — Strong Buy, based on 7 analyst ratings, 7 Buy, 0 Hold, and 0 Sell. CrowdStrike Holdings — Strong Buy, based on 32 analyst ratings, 29 Buy, 3 Hold, and 0 Sell. Alibaba — Strong Buy, based on 17 analyst ratings, 17 Buy, 0 Hold, and 0 Sell.
Michael’s personal investing style is based on a buy-and-hold approach of primarily up-and-coming tech businesses. He uses fundamental analysis to find great companies with the possibility for tremendous growth over the course of years. In fact, the company’s share price dropped roughly 20% in its first three months as a standalone firm, bottoming near $7 on Jan. 20, 2016. However, six years later, with a trailing one-year return of 24.4%, there are good reasons for investors to have HPE on their list of the best cloud stocks for 2022 and beyond.
Its trailing-12-month EBITDA margin of 10.88% is 16.9% higher than the 9.30% industry average. The stock is rated an overall Strong Buy by Koyfin’s survey of 48 analysts. Fifteen of them rate shares a Strong Buy, 32 rate GOOGL a Buy and one rates it a Hold. Of the 44 analysts surveyed by Koyfin, five rate the stock a Strong Buy and twenty say Buy. Seventeen analysts call Shopify a hold, while just two rate it a Strong Sell.