(BofA): Six Cloud Software Actions That Should Thrive” class=”gal photo” style=”” srcset=”https://www.estrategiasdeinversion.com/media/360/uploads/noticias_redaccion/Portada2/tecnolog%C3%ADa_en_bolsa.jpeg 360w,https://www.estrategiasdeinversion.com/media/420/uploads/noticias_redaccion/Portada2/tecnolog%C3%ADa_en_bolsa.jpeg 420w,https://www.estrategiasdeinversion.com/media/676/uploads/noticias_redaccion/Portada2/tecnolog%C3%ADa_en_bolsa.jpeg 676w” data-processed=”true”/>
Sills has made arguments that are very optimistic for companies in the cloud software industry and has decided to include major firms.
Their top picks include Coupa Software (COUP), Salesforce.com (CRM), HubSpot (HUBS), Splunk (SPLK), ServiceNow (NOW), and Workday (WDAY).
In an extensive research note, Sills lays out what he calls his “4M framework” for evaluating software companies: market opportunity, niche, margin, and management.
Shares with the most potential according to the market consensus
Ibex 35 shares with more potential according to the market consensus. 5 of them with more than 20% potential.
It states that the value of a software company is based on a combination the size of the target market, the ability to defend the competitive position of the company, the economy of the company’s client and the “strength and vision” of management. He sees the global addressable software market at $ 957 billion in 2020, or about 1% of the world’s gross domestic product.
Here’s your basic take on your top picks:
Coupa, $ 400 target price: “Best-in-class customer economics and early traction in underpenetrated B2B payments” Salesforce, $ 275 target: “Still a long way to organic revenue growth of over 17% , led by the digital transformation of the head office in the company “HubSpot, goal of $ 600:” Sustained growth of more than 25% in the long term “led by the consolidation of the” vast “market of applications of front-office for small ServiceNow, $ 650 target: “Long way to 25% + revenue growth driven by employee workflow automation efforts” Splunk, $ 180 target: Sills Sees ‘Big’ Opportunity in the growing observability market.Workday, $ 300 target: The company is “well positioned” to consolidate the market for back-office applications for large enterprises with a leading cloud platform.
Sills also has purchase qualifications from Adobe (ADBE), DocuSign (DOCU), Intuit (INTU), Microsoft ((MSFT)), and Veeva Systems (VEEV). It has neutral ratings on Oracle (ORCL) and VMware (VMW), and rates Shopify (SHOP) as underperforming, citing “mediocre customer economics.”
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