Investors consider top 3 cloud computing stocks as stock market faces downturn
As the stock market weathers a temporary decline, smart investors are looking for cloud computing stocks to buy. Wall Street recently ended a difficult month with major indexes falling sharply.of S&P500 It fell by 5.5% in April and by 1.6% at the end of the month, the first negative month in six years. These losses were primarily driven by rising concerns about high inflation and interest rates remaining high.
However, with the stock market facing a downturn, cloud computing stocks are a great buying opportunity for investors. As businesses increasingly rely on digital infrastructure, cloud computing is playing a key role in enabling remote work, data management, and enhanced cybersecurity. The cloud computing market is projected to reach $1.844 trillion by 2031. The market is expected to grow at a CAGR of 18.9% from 2023 to 2031.
Therefore, investing in cloud computing stocks during market downturns can be a wise strategic move. Therefore, the three cloud computing stocks appear undervalued in current conditions and could offer significant upside potential as the market stabilizes.
Snowflake (SNOW)
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snowflake (New York Stock Exchange:snow) provides cloud-based data warehousing solutions. The company has demonstrated commendable financial growth and operational resilience. In fiscal year 2024, Snowflake reported 38% year-over-year growth (YoY comparison) Product revenue increased, reflecting strong demand for the product.
Additionally, Snowflake’s market strategy includes innovative product launches. These include Snowflake Cortex, Snowpark Container Services, and Unistore to power data cloud capabilities. Snowflake’s Cortex platform is expected to be a game changer. Integrate artificial intelligence (A.I.) and machine learning deeper into the data analysis process.
The company has invested in technology and product development and is well positioned to take advantage of the growing demand for cloud data solutions.
SNOW stock is down 16% since the beginning of the year (YTD). However, analysts remain bullish, with an average price target of $219 for SNOW. This represents a 40% upside potential in the short term.
ServiceNow (Now)
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ServiceNow (New York Stock Exchange:now) is a leader in the cloud computing and digital workflow industry. The company continues to make great strides in helping businesses automate and optimize their operations. Boasts an impressive client roster that includes his 85% of Fortune 500 companies. ServiceNow’s platform is also a critical tool for businesses looking to improve efficiency and implement digital transformation strategies.
The company’s commitment to innovation is evident in its robust intellectual property portfolio, which includes more than 2,000 U.S. and international patents. ServiceNow uses AI and machine learning to continually enhance its platform to stay ahead of the curve. This ensures that the solution is cutting edge and highly effective.
Recently, the company announced impressive results for the first quarter of 2024. NOW’s EPS was $3.41, beating estimates by $0.28, and revenue was $2.6 billion, up 24.19% from the prior year and beating estimates by $14.17 million. During the financial results announcement, management specifically emphasized expanding collaboration. microsoftand critical customer engagement hitachi energy and Equinix. Additionally, key industries showing strong growth include technology, media, communications, and education.
Salesforce (CRM)
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sales force (New York Stock Exchange:CRM) has become a prominent name in the enterprise software industry. The company is strategically positioned at the forefront of enterprise software solutions through continuous innovation and expansion of its product portfolio.
Sales Cloud, the core of Salesforce’s services, is customer relationship management (CRM) A system that allows companies to manage their sales process. Additionally, the Salesforce Customer 360 platform integrates a variety of features to enhance customer connectivity and data management capabilities across a variety of industries.
CRM’s latest quarterly results further highlight its operational excellence. Salesforce beat consensus estimates, with revenue up 10.8% year-over-year. The main highlight of the financial update was operating margin expansion, which increased significantly from 14.1% to 19.3% year over year. This improvement reflects the company’s diligent cost management and operational efficiency.
The stock continues to perform well, rising 39% over the past year. Wall Street analysts are bullish on the stock, with an average price target of $333. This leaves 24% upside potential in the short term.
On the date of publication, Mohammed Saqib did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com Publishing Guidelines.
