Software Sector

Best Software Stocks in 2026

This category encompasses companies that develop enterprise software, cloud-based solutions, collaboration tools, or IT systems for businesses across industries. Many operate under a Software-as-a-Service (SaaS) model, offering scalable and recurring revenue streams. These firms help organizations manage workflows, boost productivity and support day-to-day operations, making them essential to digital transformation. The sector continues to benefit from strong demand for cloud services and ongoing innovation in enterprise technology.

Top picks11
Total market cap$1.32T
Avg YTD-22.1%
Avg 3-Year+21.4%
Avg net margin16.9%

Sector Highlights

Top picks by key criteria across the sector

Top YTD Performer
Datadog

Datadog

DDOG

-8.1%

Year-to-date return

Strongest Fundamentals
Zoom

Zoom

ZM
ProfitabilityExcellent
LiquidityExcellent
LeverageExcellent
Cash FlowGood
ValuationGood

Proprietary section scores

Market Leader
Oracle

Oracle

ORCL

$424.50B

Market cap (USD equivalent)

Sector Performance

Compare returns and net margin across our picks — toggle between periods

DatadogDatadog
-8.1%
CadenceCadence
-8.1%
ZoomZoom
-8.1%
IBMIBM
-17.2%
OracleOracle
-24.6%
SalesforceSalesforce
-27.3%
SAPSAP
-27.4%
DocuSignDocuSign
-27.8%
ServiceNowServiceNow
-27.9%
DassaultDassault
-28.7%
HubSpotHubSpot
-37.5%

Our Top 11 Software Picks

Sorted by market cap — our best-in-class selection for long-term investors

Oracle

Oracle

ORCL
NYSE
147.60USD-4.37%
YTD -24.6%
IBM

IBM

IBM
NYSE
241.33USD-2.86%
YTD -17.2%
SAP

SAP

SAP.DE
XETRA
146.86EUR-4.55%
YTD -27.4%
Salesforce

Salesforce

CRM
NYSE
184.27USD-5.59%
YTD -27.3%
ServiceNow

ServiceNow

NOW
NYSE
106.34USD-4.16%
YTD -27.9%
Cadence

Cadence

CDNS
NASDAQ
285.35USD-2.45%
YTD -8.1%
Datadog

Datadog

DDOG
NASDAQ
122.99USD-4.83%
YTD -8.1%
Dassault

Dassault

DSY.PA
PAR
16.68EUR-1.91%
YTD -28.7%
Zoom

Zoom

ZM
NASDAQ
76.55USD-1.79%
YTD -8.1%
HubSpot

HubSpot

HUBS
NYSE
238.99USD-8.80%
YTD -37.5%
DocuSign

DocuSign

DOCU
NASDAQ
46.81USD-4.07%
YTD -27.8%

Fundamental Analysis Comparison

Side-by-side view of all 5 proprietary section scores — hover a cell to see the exact score

CompanyProf.Liq.Lev.CFVal.
Oracle

Oracle

ORCL

G
G
P
G
G
IBM

IBM

IBM

G
A
W
E
G
SAP

SAP

SAP.DE

E
A
E
E
G
Salesforce

Salesforce

CRM

G
W
E
G
G
ServiceNow

ServiceNow

NOW

G
A
E
G
W
Cadence

Cadence

CDNS

E
E
E
G
P
Datadog

Datadog

DDOG

W
E
E
G
P
Dassault

Dassault

DSY.PA

G
G
E
E
G
Zoom

Zoom

ZM

E
E
E
G
G
HubSpot

HubSpot

HUBS

P
G
E
E
P
DocuSign

DocuSign

DOCU

A
A
E
G
A
Excellent(4.2–5.0)
Good(3.4–4.2)
Average(2.6–3.4)
Weak(1.8–2.6)
Poor(1.0–1.8)
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