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$1.54T
Avg YTD-0.4%
Avg 3-Year+33.2%
Avg net margin20.3%

Sector Highlights

Top picks by key criteria across the sector

Top YTD Performer
Datadog

Datadog

DDOG

+74.3%

Year-to-date return

Strongest Fundamentals
Zoom

Zoom

ZM
ProfitabilityExcellent
LiquidityExcellent
LeverageExcellent
Cash FlowGood
ValuationExcellent

Proprietary section scores

Market Leader
Oracle

Oracle

ORCL

$434.14B

Market cap (USD equivalent)

Sector Performance

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

DatadogDatadog
+74.3%
ZoomZoom
+14.1%
CadenceCadence
+8.9%
DassaultDassault
-3.1%
SalesforceSalesforce
-3.4%
SAPSAP
-5.5%
ServiceNowServiceNow
-5.5%
DocuSignDocuSign
-6.4%
IBMIBM
-20.5%
OracleOracle
-22.7%
HubSpotHubSpot
-35.0%

Our Top 11 Software Picks

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

Oracle

Oracle

ORCL
NYSE
150.72USD-0.80%
YTD -22.7%
SAP

SAP

SAP.DE
XETRA
191.32EUR+0.76%
YTD -5.5%
IBM

IBM

IBM
NYSE
235.59USD-1.34%
YTD -20.5%
Salesforce

Salesforce

CRM
NYSE
256.00USD+1.57%
YTD -3.4%
ServiceNow

ServiceNow

NOW
NYSE
144.71USD+4.54%
YTD -5.5%
Cadence

Cadence

CDNS
NASDAQ
340.39USD-2.06%
YTD +8.9%
Datadog

Datadog

DDOG
NASDAQ
236.98USD-2.45%
YTD +74.3%
Dassault

Dassault

DSY.PA
PAR
23.09EUR+0.09%
YTD -3.1%
Zoom

Zoom

ZM
NASDAQ
98.43USD-1.84%
YTD +14.1%
HubSpot

HubSpot

HUBS
NYSE
260.87USD+1.97%
YTD -35.0%
DocuSign

DocuSign

DOCU
NASDAQ
64.00USD+0.31%
YTD -6.4%

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
SAP

SAP

SAP.DE

E
A
E
E
G
IBM

IBM

IBM

G
W
W
E
G
Salesforce

Salesforce

CRM

E
A
A
G
G
ServiceNow

ServiceNow

NOW

A
W
G
G
P
Cadence

Cadence

CDNS

E
G
E
G
W
Datadog

Datadog

DDOG

W
G
E
G
P
Dassault

Dassault

DSY.PA

G
E
E
E
G
Zoom

Zoom

ZM

E
E
E
G
E
HubSpot

HubSpot

HUBS

W
G
E
E
P
DocuSign

DocuSign

DOCU

G
W
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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