For stocks that grow your investments, there are not many guarantees. Greater rewards can only come with greater risks. But one way to counteract this is to pay a lower price, which gives you a larger margin of safety. In other words, if you pay for a stock well below its intrinsic value, it will give much easier safety and rewards. This is even better in high-growth sectors.
Among such sectors is the software industry. An industry that offers many stocks to buy if you are seeking guaranteed winners. Below, let’s discuss three of these stocks.
CrowdStrike
CrowdStrike Holdings gave an impressive yearly recurring revenue for its first quarter. Net new ARR reached $144 million as net new customers increased by 1,524. CRWD stock gained 4.85% since their June 3 report.
CEO George Kurtz said, “We think the robust demand driven by secular trends, like security transformation, cloud use and a greater threat environment.” He told investors that the company’s competitive solution works across numerous clouds. The company is creating more capabilities, like drift detection, which increases threat detection.
CrowdStrike is embracing the cloud opportunity. And their product has virtual instances that gives customers real-time protection. Utilizing machine learning, they identify threats and prevent them from spreading inside a user’s environment.
CRWD stock will continue increasing since customers save money by using CrowdStrike’s product compared to handing over ransom after a hacker attack.
Elastic
In Q4, Elastic reported revenue growth of 44% to $177.6 million, SAAS revenue went up 77% to $51.3 million, and full-year 2021 revenue increased 42% to $608.5 million. ESTC stock boosted 15.4% since the June earnings report.
The company, started in 2012, now has more than 15,000 subscribers. It has a flexible model, either on-premise, hybrid cloud or hybrid. That will improve its reach as people get back to a post-pandemic life.
Elastic has an edge over their competition, taking market share from Splunk, for example. Conversely, Elastic does not have a problem with data. It sees data as a capability. As CEO Shay Banon said, Elastic provides better search. Plus their solution gives better connection in critical supply chains. Customers cannot afford to not have Elastic solution.
MongoDB (MDB)
MongoDB is a NoSQL database with around 25,000 paying customers and more than 1.5 million free users. MongoDB gives both licenses as well as subscriptions for its database.
On June 3, it gave its exceptional Q1 results and investors have increased the MDB stock 16.2% in the days after.
MongoDB reported revenue growing by 39% year over year to $181.6 million. CEO Dev Ittycheria stressed the ongoing results of Atlas, its top paid product. The company created Atlas five years ago to give customers a completely managed MongoDB database. In Q1, gross profit reached $127.1 million. Although their gross margin was 70%, it gave a loss from operations of $61.4 million. It lost $1.04 per share during this time.
MDB concluded the quarter with $935.6 million in cash. In the second quarter, the company anticipates revenue between $180 million – $183 million. It also predicted a loss per share of 40 cents to 43 cents. MongoDB’s Atlas performance is a key number. Customer demand for the cloud-native product is increasing from 60% last year to over 70% in 2021.
Author: Scott Dowdy
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