Best SaaS stocks to invest in 2025

Software-as-a-Service companies have transformed how businesses operate, delivering cloud-based solutions that drive efficiency, scalability, and innovation. The best SaaS stocks combine recurring revenue models with strong customer retention, creating predictable cash flows and long-term growth potential.

Palantir delivers advanced AI-driven analytics solutions to commercial and government clients, enabling organizations to integrate and analyze vast amounts of complex data for critical operations. Oracle provides comprehensive cloud infrastructure and database solutions, maintaining its position as a leading enterprise software provider with extensive SaaS offerings. CyberArk specializes in identity security and privileged access management, protecting organizations from cyber threats through cloud-based security solutions.

As 2025 progresses, leading SaaS companies remain positioned to capture growing demand for cloud-based business solutions. These stocks offer investors exposure to recurring revenue models and the ongoing shift from on-premise to cloud software.

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Before we dive into each company, let`s take a look at how your investment would have performed if you had invested in stocks mentioned in this article.

Now, let`s take a closer look at each of the companies:

• Palantir (NYSE:PLTR)

  Palantir Technologies is a premier data analytics and artificial intelligence company specializing in mission-critical software solutions for government agencies, defense contractors, and commercial enterprises worldwide. Founded in 2003 by Peter Thiel and Alex Karp and headquartered in Denver, Colorado, the company has evolved from supporting US intelligence operations to becoming a global leader in big data analytics. The company has demonstrated strong growth in both government and commercial sectors, particularly benefiting from increased defense spending and digital transformation initiatives across industries.

  The company`s core business revolves around its flagship platforms Palantir Gotham for government and defense applications, and Palantir Foundry for commercial enterprises, both leveraging advanced AI and machine learning capabilities. Palantir`s software enables organizations to integrate, analyze, and act on vast amounts of complex data for critical operations including national security, counterterrorism, supply chain optimization, and strategic decision-making. With rising demand for AI-powered analytics and data-driven insights across sectors, Palantir is strategically positioned to capitalize on digital transformation trends and the growing need for sophisticated data analysis capabilities in an increasingly complex global environment.

  Palantir financial statements

  Analysts recommendation: 2.86

  Financial Health

  • Return on assets (ROA): 12.16%
  • Return on equity (ROE): 15.3%
  • Return on investment (ROI): 12.47%

  Profitability

  • Gross margin: 80.03%
  • Operating margin: 16.55%
  • Net profit margin: 22.18%

  Growth

  • EPS (past 5 years): N/A
  • EPS (current): 0.3
  • EPS estimate (next quarter): 0.17
  • EPS growth (this year): 57.86%
  • EPS growth (next year): 30.16%
  • EPS growth (next 5 years): 40.25%
  • EPS growth (quarter-over-quarter): 129.32%
  • Sales growth (past 5 years): 31.01%
  • Sales growth (quarter-over-quarter): 48.01%

  💡 Why invest in Palantir?

  Like a sophisticated intelligence network that processes vast amounts of data to reveal critical insights, Palantir demonstrates several compelling strengths that make it an attractive investment in the AI and defense technology sectors:

  • Government Defense Dominance: Palantir holds long-term contracts with U.S. defense agencies, intelligence services, and allied governments, creating predictable revenue streams and deep operational integration with critical systems.
  • AI Technology Leadership: The company`s advanced artificial intelligence and machine learning platforms provide unmatched data integration and analysis capabilities that create significant competitive advantages.
  • Commercial Market Expansion: Palantir is rapidly expanding its commercial footprint across healthcare, manufacturing, and financial services, diversifying revenue sources and reducing dependence on government contracts.
  • High Customer Retention: The company`s deep integration with client operations and proprietary technology platforms create substantial switching costs and long-term customer relationships that drive recurring revenue growth.

  🐌 Key considerations before investing in Palantir

  However, like navigating through encrypted data streams where hidden vulnerabilities can compromise entire systems, Palantir faces several significant challenges that technology investors must carefully evaluate:

  • Ongoing Profitability Pressure: Despite strong revenue growth, the company faces ongoing profitability challenges due to high operating expenses, significant R&D investments, and competitive pricing pressures in commercial markets.
  • Government Contract Dependency: Heavy reliance on government and defense contracts makes the company vulnerable to budget cuts, political changes, and shifts in defense spending priorities that could impact revenue stability.
  • High Valuation Volatility: As a high-growth technology stock, Palantir experiences significant price volatility driven by market sentiment, earnings performance, and investor expectations for commercial growth acceleration.
  • Ongoing Ethical Concerns: The company`s involvement in government surveillance and defense applications raises ongoing ethical concerns and regulatory scrutiny that could impact public perception and commercial adoption.

  Final thoughts on Palantir

  Palantir`s leadership in AI-powered data analytics, strategic government partnerships, and expanding commercial presence create compelling opportunities for investors seeking exposure to the growing artificial intelligence and defense technology sectors. However, the company`s profitability challenges, government contract dependency, valuation volatility, and ethical concerns require careful evaluation of the complex dynamics in data analytics markets. Like a master codebreaker who transforms raw intelligence into actionable insights, Palantir combines technological excellence with strategic positioning to navigate competitive pressures while delivering mission-critical analytics solutions for government agencies and commercial enterprises worldwide.

• CyberArk (NYSE:CYBR)

  CyberArk is a global leader in identity security, specializing in protecting organizations from cyber threats by securing privileged accounts, credentials, and access. Headquartered in Petah Tikva, Israel, the company was founded in 1999 by Alon N. Cohen and Udi Mokady. Since its inception, CyberArk has played a pivotal role in advancing cybersecurity practices, helping businesses safeguard their most sensitive digital assets.

  The company`s core business focuses on providing solutions for privileged access management (PAM), identity governance, and endpoint security. CyberArk`s flagship offerings include tools to detect and mitigate risks associated with privileged accounts, as well as solutions for managing secrets in DevOps workflows. Trusted by enterprises and governments worldwide, CyberArk continues to empower organizations to strengthen their defenses against increasingly sophisticated cyberattacks while enabling secure digital transformation.

  CyberArk financial statements

  Analysts recommendation: 2.69

  Financial Health

  • Return on assets (ROA): -4.97%
  • Return on equity (ROE): -10.35%
  • Return on investment (ROI): -4.67%

  Profitability

  • Gross margin: 74.99%
  • Operating margin: -6.88%
  • Net profit margin: -13.78%

  Growth

  • EPS (past 5 years): N/A
  • EPS (current): -3.38
  • EPS estimate (next quarter): 0.92
  • EPS growth (this year): 28.27%
  • EPS growth (next year): 24.27%
  • EPS growth (next 5 years): 28.19%
  • EPS growth (quarter-over-quarter): -502.23%
  • Sales growth (past 5 years): 18.19%
  • Sales growth (quarter-over-quarter): 45.98%

  💡 Why invest in CyberArk?

  Several key factors make CyberArk Software an attractive prospect for investors seeking exposure to the critical cybersecurity sector:

  • Privileged Access Leadership: CyberArk is a recognized leader in the PAM market, offering best-in-class solutions for securing privileged accounts and credentials across enterprise environments with proven track record and market dominance.
  • Comprehensive Security Solutions: Their platform goes beyond password management, providing a holistic approach to privileged access security with integrated identity governance, endpoint protection, and threat detection capabilities.
  • Innovation Investment Focus: CyberArk actively invests in research and development, staying ahead of evolving cyber threats and expanding their PAM capabilities through continuous platform enhancements and emerging technology integration.
  • Growing Cybersecurity Demand: The ever-increasing reliance on technology and the escalating threat landscape drive consistent demand for robust cybersecurity solutions, creating sustained market opportunities for specialized providers.

  🐌 Key considerations before investing in CyberArk

  While CyberArk`s leadership in PAM, comprehensive platform, and focus on innovation are strengths, there are challenges to consider in the cybersecurity sector:

  • Cybersecurity Market Competition: The cybersecurity market is a crowded space with established players and emerging vendors vying for market share, creating pricing pressure and customer acquisition challenges for specialized providers.
  • PAM Solution Complexity: Implementing and maintaining a PAM solution can be complex, requiring skilled cybersecurity professionals and significant organizational change management to achieve successful deployment and adoption.
  • Threat Landscape Evolution: Cybercriminals are constantly developing new attack methods, requiring CyberArk to continuously update and improve their PAM platform to stay effective against sophisticated and evolving security threats.
  • Platform Security Risks: Since CyberArk safeguards highly sensitive privileged credentials, any security breach within their platform could have severe consequences for both the company and its enterprise customers worldwide.

  Final thoughts on CyberArk

  CyberArk`s leadership in privileged access management, comprehensive security platform, and innovation focus create compelling opportunities for investors seeking exposure to the essential cybersecurity sector. However, market competition, solution complexity, evolving threats, and platform security risks require careful evaluation of the company`s strategic positioning and execution capabilities. Investors should thoroughly research CyberArk`s competitive advantages and risk management approach before making investment decisions in this critical cybersecurity leader.

• Oracle (NYSE:ORCL)

  Oracle Corporation is a multinational technology company headquartered in Austin, Texas. Founded in 1977, Oracle is one of the world`s largest providers of enterprise software and cloud solutions. The company initially gained recognition for its pioneering relational database management systems, and over the years, it has expanded its portfolio to include a wide range of cloud computing, software, and hardware products.

  Oracle specializes in offering cloud-based infrastructure, software-as-a-service (SaaS), and database solutions to businesses globally. Its flagship products, such as Oracle Cloud and Oracle Database, enable organizations to manage, analyze, and secure their data efficiently. With a focus on innovation and customer success, Oracle continues to lead the way in providing scalable, integrated solutions for enterprises of all sizes.

  Oracle financial statements

  Analysts recommendation: 1.83

  Financial Health

  • Return on assets (ROA): 7.66%
  • Return on equity (ROE): 71.15%
  • Return on investment (ROI): 10.02%

  Profitability

  • Gross margin: 66.1%
  • Operating margin: 31.63%
  • Net profit margin: 21.08%

  Growth

  • EPS (past 5 years): 7.13%
  • EPS (current): 4.32
  • EPS estimate (next quarter): 1.64
  • EPS growth (this year): 13.27%
  • EPS growth (next year): 17.13%
  • EPS growth (next 5 years): 21.84%
  • EPS growth (quarter-over-quarter): -2.06%
  • Sales growth (past 5 years): 8%
  • Sales growth (quarter-over-quarter): 12.17%

  💡 Why invest in Oracle?

  Like a robust enterprise foundation that powers critical business operations worldwide, Oracle demonstrates compelling strengths for cloud technology investors:

  • Mission Critical Software: Businesses rely on Oracle`s database and enterprise applications to function, making their products irreplaceable for many organizations while generating recurring revenue streams and customer loyalty.
  • Cloud Transition Success: Oracle successfully migrates its enterprise software portfolio to cloud infrastructure, ensuring market relevance while capitalizing on expanding global cloud computing demand and modern deployment preferences.
  • Strong Brand Recognition: The Oracle brand represents enterprise-grade reliability and innovation, providing competitive advantages in customer acquisition, retention, and premium pricing power across global markets.
  • Global Reach Excellence: Oracle operates worldwide with established presence in developed and emerging markets, positioning the company to capitalize on international growth opportunities and digital transformation initiatives.

  🐌 Key considerations before investing in Oracle

  However, like navigating competitive enterprise markets where cloud-native solutions challenge traditional approaches, Oracle faces significant challenges that technology investors must evaluate:

  • Competition Pressure Intensity: Intense competition from Microsoft, Amazon, Google, and cloud-native startups challenges Oracle`s market position through innovative solutions, competitive pricing, and modern architectures.
  • Shifting Customer Preferences: Evolving customer preferences toward cloud-native solutions and subscription models require Oracle to adapt its traditional approach while competing against modern development paradigms and agile competitors.
  • Maturing Market Dynamics: The traditional enterprise software market shows maturation signs with slower growth rates and increased competition that could limit Oracle`s expansion opportunities in core database and applications segments.
  • Integration Challenges Complexity: Complex enterprise system migrations present technical and timeline challenges that can delay customer adoption of Oracle`s cloud solutions and impact implementation success rates and customer satisfaction.

  Final thoughts on Oracle

  Oracle`s strong brand recognition, established customer base, successful cloud transition, and global market presence create compelling advantages for investors seeking exposure to the essential enterprise software sector. However, intense competition from technology giants and cloud-native startups, evolving customer preferences toward modern architectures, and complex enterprise migration challenges present significant headwinds that require careful evaluation. Like a master architect of digital infrastructure, Oracle continues building the foundation for enterprise data management while adapting to the cloud-first future that defines modern business operations.

• Cloudflare (NYSE:NET)

  Cloudflare, Inc. is a global web infrastructure and security company that enhances the performance, reliability, and safety of internet properties through its expansive content delivery network (CDN), DDoS protection, and security services. The company was founded in 2009 by Matthew Prince, Lee Holloway, and Michelle Zatlyn, and is headquartered in San Francisco, California. From its early days emerging from Project Honey Pot to launching at TechCrunch Disrupt in September 2010, Cloudflare has rapidly scaled its network infrastructure to over 330 data centers across 125+ countries, supporting nearly 20% of all websites globally.

  Cloudflare`s core business centers on delivering a comprehensive suite of cloud, security, and performance services to millions of websites and applications worldwide. Key offerings include its global CDN, robust DDoS mitigation, next-gen Web Application Firewall, domain name services, and edge computing via its Workers platform. The company is also investing in AI-powered tools such as bot detection, API protection, and content scraping defenses to stay ahead in the evolving cybersecurity landscape.

  Cloudflare financial statements

  Analysts recommendation: 2.11

  Financial Health

  • Return on assets (ROA): -2.76%
  • Return on equity (ROE): -11.04%
  • Return on investment (ROI): -2.52%

  Profitability

  • Gross margin: 76.12%
  • Operating margin: -9.65%
  • Net profit margin: -6.22%

  Growth

  • EPS (past 5 years): 8.13%
  • EPS (current): -0.34
  • EPS estimate (next quarter): 0.27
  • EPS growth (this year): 20.53%
  • EPS growth (next year): 29.51%
  • EPS growth (next 5 years): 27.03%
  • EPS growth (quarter-over-quarter): -227.77%
  • Sales growth (past 5 years): 42.21%
  • Sales growth (quarter-over-quarter): 27.76%

  💡 Why invest in Cloudflare?

  Like a global network shield that protects and accelerates internet traffic worldwide, Cloudflare demonstrates compelling strengths for cloud security investors:

  • Robust Growth Trajectory: Cloudflare demonstrates exceptional revenue momentum with 29% growth in 2024 and sustained 25-27% expansion rates, supported by strong enterprise customer acquisition and increasing deal sizes.
  • Strong Product Differentiation: With edge computing, AI integration, and Zero Trust security built into its core platform, Cloudflare remains well-positioned in competitive markets through innovative technology solutions.
  • High Value Customer: Q4 2024 saw a 47% increase in $1M+ customers, with 173 such contracts, including the largest-ever deal exceeding $100M, demonstrating strong enterprise market penetration and customer expansion capabilities.
  • Cash Rich Model: Despite GAAP losses, free cash flow exceeded $166 million in 2024, with non-GAAP earnings turning positive and strong operating leverage indicating improving financial performance and business model efficiency.

  🐌 Key considerations before investing in Cloudflare

  However, prospective investors should weigh the following challenges:

  • GAAP Profitability Negative: While non-GAAP profits improve, Cloudflare still posted GAAP losses, which may concern conservative investors seeking immediate profitability and traditional financial metrics for validation.
  • Potential Valuation Risks: Shares surged approximately 67% year-to-date in 2025, raising the risk of a significant pullback if growth metrics or guidance disappoints investors, creating potential volatility.
  • Guidance Sensitivity Volatility: Q1 2025 projection fell slightly short of analyst expectations, indicating sensitivity to guidance delivery and potential challenges in meeting market forecasts and investor confidence.
  • Intense Competition Pressure: The cybersecurity and edge computing sectors are crowded, with strong competition from established players like Palo Alto, Microsoft, and AWS challenging market share and pricing power.

  Final thoughts on Cloudflare

  Cloudflare has demonstrated strong 2024 growth and entered 2025 with robust momentum, powered by enterprise deals, innovative edge and security offerings, and improving cash flows. Its differentiated, AI-infused platform and customer expansion strategy support long-term scalability and defensibility. However, investors should remain cautious of its GAAP losses, valuation stretch, occasional guidance softening, and intensifying competition in the sector.

• CrowdStrike (NYSE:CRWD)

  CrowdStrike Holdings Inc is a cybersecurity technology company that provides cloud-native endpoint security solutions to organizations worldwide. Founded in 2011 by George Kurtz and Dmitri Alperovitch and headquartered in Austin, Texas, the company has quickly become a leader in endpoint security, threat intelligence, and cyberattack response. CrowdStrike`s Falcon platform revolutionized cybersecurity with its cloud-native architecture, providing real-time protection and visibility across organizations of all sizes.

  The company specializes in preventing, detecting, and responding to sophisticated cyber threats through its AI-powered solutions and advanced threat intelligence capabilities. Its services include endpoint protection, managed threat hunting, and proactive incident response, catering to industries such as finance, healthcare, and government sectors. With a strong focus on innovation and scalability, CrowdStrike has earned a reputation as a trusted partner in securing critical systems and sensitive data worldwide.

  CrowdStrike financial statements

  Analysts recommendation: 1.89

  Financial Health

  • Return on assets (ROA): -3.6%
  • Return on equity (ROE): -8.99%
  • Return on investment (ROI): -6.52%

  Profitability

  • Gross margin: 74%
  • Operating margin: -5.61%
  • Net profit margin: -6.84%

  Growth

  • EPS (past 5 years): 34.76%
  • EPS (current): -1.2
  • EPS estimate (next quarter): 0.94
  • EPS growth (this year): -6.66%
  • EPS growth (next year): 29.93%
  • EPS growth (next 5 years): 16.1%
  • EPS growth (quarter-over-quarter): -266.11%
  • Sales growth (past 5 years): 52.37%
  • Sales growth (quarter-over-quarter): 21.28%

  💡 Why invest in CrowdStrike?

  CrowdStrike`s unique position in the cybersecurity industry offers several potential advantages for investors seeking exposure to this critical sector:

  • Essential Cybersecurity Solutions: In today`s interconnected world, robust cybersecurity is no longer optional, and CrowdStrike`s solutions safeguard businesses from cyberattacks with irreplaceable protection capabilities.
  • Cloud-Native Security Advantage: Their focus on cloud-based security aligns perfectly with the growing adoption of cloud computing, ensuring their solutions remain relevant, scalable, and future-ready for enterprises.
  • Continuous Innovation Leadership: CrowdStrike recognizes the constantly evolving nature of cyber threats and continuously develops their cloud-powered security platform, staying ahead of emerging threats globally and effectively.
  • Strong Revenue Growth: CrowdStrike boasts a history of consistent revenue growth, demonstrating the increasing demand for their innovative cybersecurity solutions across global enterprise markets worldwide.

  🐌 Key considerations before investing in CrowdStrike

  However, before investing in CrowdStrike Holdings, it`s crucial to consider the potential challenges they face:

  • High Stock Valuation: CrowdStrike`s high valuation reflects its strong growth potential, but it may also leave less room for future stock price appreciation in competitive market conditions globally and domestically.
  • Market Competition Intensity: The cybersecurity market is crowded with established players and nimble startups vying for market share, requiring CrowdStrike to maintain their technological edge continuously worldwide.
  • Evolving Threat Landscape: The ever-changing nature of cyber threats requires CrowdStrike to continuously adapt and improve their security platform to stay effective against sophisticated attacks globally and consistently.
  • Subscription Revenue Dependency: Their revenue stream relies heavily on recurring subscriptions, and any slowdown in customer acquisition or increased churn could impact their financial performance significantly worldwide.

  Final thoughts on CrowdStrike

  CrowdStrike`s strong market position, cloud-native advantage, focus on innovation, and impressive growth trajectory create compelling opportunities for long-term investors seeking exposure to the cybersecurity sector. However, high valuation, competitive pressures, evolving threats, and subscription dependency require careful evaluation of the company`s strategic positioning and execution capabilities. Investors should thoroughly research CrowdStrike`s platform capabilities and competitive advantages before making investment decisions in this cybersecurity leader.

• Microsoft (NYSE:MSFT)

  Microsoft Corporation is a global technology company that develops software, cloud computing services, and hardware products for consumers and enterprises worldwide. Founded in 1975 by Bill Gates and Paul Allen and headquartered in Redmond, Washington, Microsoft revolutionized the software industry with its Windows operating system. The company has since expanded into cloud computing, hardware, and digital services, becoming one of the largest and most influential technology firms globally.

  Microsoft specializes in software products like Windows and Office, cloud services through Azure, and hardware including Surface devices and Xbox consoles. The company leads in cloud computing by offering comprehensive cloud-based services for businesses and developers across multiple industries. Microsoft continues to drive technological advancements and digital transformation through innovation, empowering people and organizations to achieve more.

  Microsoft financial statements

  Analysts recommendation: 1.13

  Financial Health

  • Return on assets (ROA): 18.1%
  • Return on equity (ROE): 32.24%
  • Return on investment (ROI): 22.47%

  Profitability

  • Gross margin: 68.76%
  • Operating margin: 46.27%
  • Net profit margin: 35.71%

  Growth

  • EPS (past 5 years): 18.8%
  • EPS (current): 14.06
  • EPS estimate (next quarter): 3.91
  • EPS growth (this year): 16.97%
  • EPS growth (next year): 17.18%
  • EPS growth (next 5 years): 17.4%
  • EPS growth (quarter-over-quarter): 12.55%
  • Sales growth (past 5 years): 14.52%
  • Sales growth (quarter-over-quarter): 18.43%

  💡 Why invest in Microsoft?

  Microsoft presents a compelling investment case due to its unwavering revenue streams, cutting-edge AI ventures, thriving gaming presence, and unwavering commitment to innovation:

  • Strong Recurring Revenue: Microsoft`s financial stability rests on Office 365 and Azure cloud platform, generating consistent recurring income while capturing significant market share in the rapidly expanding global cloud sector.
  • AI Technology Leadership: Microsoft`s strategic investments in OpenAI and ChatGPT integration into Bing demonstrate forward-thinking AI leadership, positioning the company to challenge Google`s search dominance effectively.
  • Gaming Division Strength: Microsoft`s Xbox division thrives with Series X/S success and Game Pass cloud gaming ecosystem. This diversified gaming presence creates powerful revenue streams and insulates against market fluctuations.
  • Strong Market Adaptability: Microsoft consistently adapts and innovates across AI, cloud computing, and productivity tools. This agility enables continuous growth, market share expansion, and relevance in the dynamic tech landscape.

  🐌 Key considerations before investing in Microsoft

  While Microsoft`s strengths are undeniable, some factors merit careful consideration:

  • Azure Competition Pressure: Azure faces fierce competition from AWS, Google Cloud, and other established players in the crowded cloud computing market, requiring continuous innovation and competitive pricing strategies.
  • Regulatory Compliance Scrutiny: Large acquisitions like Activision Blizzard face lengthy regulatory approval processes and potential challenges that could significantly impact future growth plans and strategic partnerships.
  • High Valuation Premium: Microsoft`s stock trades near all-time highs with limited room for immediate significant gains, suggesting investors should consider waiting for more attractive entry points before investing.
  • Recession Revenue Risk: Economic downturns could reduce corporate and consumer technology spending, affecting Azure and Office 365 subscriptions and making revenue vulnerable to broader economic trends and cycles.

  Final thoughts on Microsoft

  Microsoft`s diverse revenue streams, AI leadership, and market adaptability make it a compelling long-term investment opportunity. However, intense cloud competition, regulatory scrutiny, and elevated valuation levels present notable challenges requiring careful consideration. Like a seasoned conductor orchestrating multiple instruments, Microsoft harmonizes various business segments to create a symphony of sustainable growth and innovation.

• SAP (DE:SAP)

  SAP SE is a leading European software company that provides enterprise resource planning and cloud computing solutions to organizations worldwide. Founded in 1972 by five former IBM engineers and headquartered in Walldorf, Germany, SAP has grown into one of the world`s largest enterprise software providers. The company serves organizations in over 180 countries with its flagship ERP suite SAP S/4HANA and comprehensive business software solutions.

  SAP specializes in cloud-based customer experience solutions, AI-driven data analytics, and tools for sustainability and intelligent automation across multiple industries. The company`s offerings help businesses integrate operations, finance, human resources, and supply chain management through advanced in-memory processing and analytics capabilities. SAP empowers clients to achieve digital transformation while upholding European standards of data privacy and security compliance.

  SAP financial statements

  Analysts recommendation: 1.62

  Financial Health

  • Return on assets (ROA): 9.06%
  • Return on equity (ROE): 17.03%
  • Return on investment (ROI): 13.66%

  Profitability

  • Gross margin: 73.83%
  • Operating margin: 28.27%
  • Net profit margin: 19.41%

  Growth

  • EPS (past 5 years): -1.42%
  • EPS (current): 6.04
  • EPS estimate (next quarter): 1.78
  • EPS growth (this year): 37.9%
  • EPS growth (next year): 18.91%
  • EPS growth (next 5 years): 28.24%
  • EPS growth (quarter-over-quarter): 46.46%
  • Sales growth (past 5 years): 3.69%
  • Sales growth (quarter-over-quarter): 7.2%

  💡 Why invest in SAP?

  Key strengths that make SAP an attractive investment:

  • ERP Market Leadership: SAP dominates the global ERP market, with a strong foothold among Fortune 500 companies and major enterprises worldwide, providing comprehensive business solutions and digital transformation.
  • Robust Cloud Transition: Its shift to cloud-native platforms anchored by SAP S/4HANA Cloud drives recurring subscription revenue and long-term growth potential across enterprise markets globally and consistently.
  • Advanced AI Analytics: Embedded machine learning and advanced analytics across its portfolio enhance automation, predictive insights, and real-time decision-making capabilities for enterprises worldwide.
  • Strong Financial Profile: Consistent subscription and maintenance revenues underpin stable cash flows, a solid balance sheet, and shareholder returns via dividends across market cycles consistently and reliably.

  🐌 Key considerations before investing in SAP

  Potential challenges and risks to consider:

  • Competitive Cloud Landscape: SAP faces intense competition in cloud services from Microsoft Azure, Amazon Web Services, Oracle, and Salesforce, requiring continuous innovation and investment globally and consistently.
  • Complex Implementation Challenges: Large-scale SAP deployments can be costly and time-intensive, posing barriers for small and mid-market customers seeking enterprise solutions and digital transformation initiatives.
  • Enterprise Customer Dependency: A significant share of revenue comes from large corporations, making SAP sensitive to macroeconomic swings in IT spending and budget constraints across markets globally and consistently.
  • Cloud Adoption Challenges: While accelerating, SAP`s overall migration from on-premises to cloud solutions trails some purely cloud-native rivals in market adoption and customer preference globally and consistently.

  Final thoughts on SAP

  SAP SE combines deep European roots and a storied history in enterprise software with a forward-looking cloud and AI strategy. Its leadership in ERP, expanding cloud footprint, and strong financials make it a compelling choice for investors seeking exposure to digital transformation trends, particularly those valuing European data-privacy standards and sustainability commitments. Nonetheless, prospective investors should weigh competitive pressures, implementation complexities, and macroeconomic sensitivities before taking a long-term position.

• Zscaler (NYSE:ZS)

  Zscaler, Inc. is a cloud-native cybersecurity company delivering comprehensive security services via its Zero Trust Exchange platform to enterprises across more than 125 countries. Founded in 2007 and headquartered in San Jose, California, Zscaler has rapidly scaled its network to over 330 data centers worldwide. In the past year, its stock has seen a total return of approximately +75%, significantly outperforming the S&P500 (~14%), and its share price has climbed about +64% year-to-date, reflecting strong investor confidence.

  Zscaler`s core business is centered on delivering cloud-based security solutions that replace traditional on-premises architectures with scalable, automated protective services. Its platform includes Zero Trust Internet Access, Private Access, and Security Service Edge (SSE), protecting user connections, cloud workloads, and web applications from threats using AI, machine learning, and extensive threat intelligence. By continuously enhancing its capabilities such as adding SASE and AI-powered bot detection Zscaler empowers organizations to securely embrace cloud transformation and remote work.

  Zscaler financial statements

  Analysts recommendation: 1.63

  Financial Health

  • Return on assets (ROA): -0.75%
  • Return on equity (ROE): -2.7%
  • Return on investment (ROI): -1.17%

  Profitability

  • Gross margin: 76.82%
  • Operating margin: -4.48%
  • Net profit margin: -1.55%

  Growth

  • EPS (past 5 years): 21.31%
  • EPS (current): -0.27
  • EPS estimate (next quarter): 0.86
  • EPS growth (this year): 11.4%
  • EPS growth (next year): 20.28%
  • EPS growth (next 5 years): 18.11%
  • EPS growth (quarter-over-quarter): -14.36%
  • Sales growth (past 5 years): 44.03%
  • Sales growth (quarter-over-quarter): 21.31%

  💡 Why invest in Zscaler?

  Zscaler offers several compelling reasons to consider investing:

  • Rapid Revenue Growth: After 34% revenue growth in 2024, Zscaler reached $2.17B, supported by broad enterprise adoption of SASE and Zero Trust platforms while expanding its global customer base and market penetration significantly.
  • Zero Trust Leadership: The company is consistently ranked a market leader, with its cloud-native platform processing trillions of transactions daily a strong competitive moat and technological differentiation.
  • Innovative Product Expansions: Strategic partnerships with companies like Vectra AI and acquisitions like Red Canary reinforce its threat detection and cybersecurity ecosystem, enhancing platform capabilities and market competitiveness.
  • Recurring Subscription Model: High renewal rates and expanding billings maintain predictable, recurring revenue streams and strong deferred revenue growth, providing financial stability and visibility for long-term business planning.

  🐌 Key considerations before investing in Zscaler

  However, prospective investors should weigh the following challenges:

  • Revenue Growth Deceleration: After 2024 growth, revenue fell approximately 8% year-over-year by April 2025, indicating slower momentum and potential market saturation that could impact future growth prospects and investor confidence.
  • Profitability Challenges Persist: The firm remains loss-making under GAAP accounting, with non-GAAP adjustments masking core losses, raising concerns about underlying profitability and sustainable business model economics.
  • Competitive Market Pressures: Zscaler faces pressure from major players like Palo Alto Networks, Microsoft, and emerging rivals like Wiz, challenging market share and pricing power in competitive cybersecurity segments.
  • Valuation Premium Risks: Its high-growth premium has cooled, evidenced by a 16% stock decline in 2024 and post-earnings dips on conservative guidance, creating valuation risk if growth expectations are not met consistently.

  Final thoughts on Zscaler

  Zscaler stands as a leading innovator in cloud-based security with a scalable subscription model, strong platform differentiation, and solid 2024 expansion. While growth has moderated in early 2025 and the company remains non-GAAP profitable, its focus on AI-driven capabilities and platform integration positions it well for future enterprise adoption. However, investors should weigh valuation normalization, ongoing GAAP losses, and intensifying competitive pressures when assessing Zscaler`s long-term investment potential.

• Intuit (NYSE:INTU)

  Intuit Inc. is a global financial technology company specializing in software solutions for accounting, tax preparation, and personal finance management. Founded in 1983 and headquartered in Mountain View, California, Intuit is best known for its flagship products, including QuickBooks, TurboTax, and Credit Karma, which serve individuals, small businesses, and financial professionals. The company leverages artificial intelligence and cloud-based platforms to simplify financial processes, helping users manage their money, file taxes, and grow their businesses efficiently.

  With a strong presence in financial software, Intuit continues to innovate by integrating automation, real-time data insights, and personalized recommendations into its products. Its QuickBooks platform provides comprehensive accounting tools for businesses, while TurboTax streamlines tax filing with AI-driven accuracy and ease. By focusing on user-centric financial solutions, Intuit remains a leader in empowering individuals and businesses to make smarter financial decisions.

  Intuit financial statements

  Analysts recommendation: 1.58

  Financial Health

  • Return on assets (ROA): 11.2%
  • Return on equity (ROE): 20.29%
  • Return on investment (ROI): 14.72%

  Profitability

  • Gross margin: 77.01%
  • Operating margin: 26.22%
  • Net profit margin: 20.55%

  Growth

  • EPS (past 5 years): 14.6%
  • EPS (current): 13.71
  • EPS estimate (next quarter): 3.09
  • EPS growth (this year): 14.86%
  • EPS growth (next year): 13.53%
  • EPS growth (next 5 years): 14.05%
  • EPS growth (quarter-over-quarter): 1992.3%
  • Sales growth (past 5 years): 19.65%
  • Sales growth (quarter-over-quarter): 20.32%

  💡 Why invest in Intuit?

  Like a comprehensive financial software ecosystem, Intuit demonstrates compelling strengths for fintech investors:

  • Small Business Dominance: Intuit commands dominant market position in U.S. small business accounting and DIY tax filing software, generating consistent revenue streams and maintaining powerful brand recognition advantages.
  • Strategic Acquisition Portfolio: Beyond core markets, Intuit expands through strategic acquisitions like Mint and Credit Karma, diversifying revenue sources and accessing new customer segments for sustained growth.
  • Subscription Revenue Model: QuickBooks and TurboTax subscription-based models deliver highly predictable recurring income, foster strong customer loyalty, and provide solid financial foundation for long-term value creation.
  • AI Innovation Leadership: Intuit actively invests in artificial intelligence and automation technologies, integrating advanced capabilities into software products to enhance user experience and maintain advantages.

  🐌 Key considerations before investing in Intuit

  However, navigating valuation pressures and competitive dynamics presents significant challenges for investors:

  • Premium Valuation Risk: Intuit trades near all-time highs with elevated valuation multiples, potentially limiting immediate upside and creating downside risk if growth expectations are not met or market sentiment shifts.
  • Fintech Competition Intensity: Emerging fintech players and established financial institutions create increasing competitive pressure, particularly in digital payments and lending, requiring continuous innovation to maintain market position.
  • Economic Cycle Sensitivity: Economic downturns significantly impact small business formation and consumer spending, potentially affecting Intuit's sales growth, subscription renewals, and overall financial performance during recessions.
  • Regulatory Compliance Challenges: Financial software industry faces evolving regulations introducing compliance costs and operational complexity, potentially impacting product offerings and requiring ongoing regulatory investments.

  Final thoughts on Intuit

  Intuit's market dominance, subscription revenue model, and AI innovation leadership position it as a leading financial software provider for small businesses and consumers. However, investors must weigh premium valuation risks, intensifying fintech competition, and economic cycle sensitivity that create execution challenges. Like a comprehensive financial management platform serving millions, Intuit offers exposure to digital finance trends with the benefits of market leadership balanced against valuation and competitive pressures in evolving fintech markets.

• Manhattan Associates (NYSE:MANH)

  Manhattan Associates, Inc., headquartered in Atlanta, Georgia, is a leading provider of supply chain and omnichannel commerce software solutions. In 2024, the company reported record revenues of $1.04 billion, marking a 12.2% increase from the previous year, and a net income of $218.4 million, up 23.7% year-over-year. Operating income reached $261.6 million, reflecting a 25% increase from 2023. Manhattan Associates` core business centers on delivering cloud-native supply chain and omnichannel commerce solutions through its Manhattan ActiveВ® platform. The company offers a comprehensive suite of applications, including warehouse management systems (WMS), transportation management systems (TMS), order management systems (OMS), and supply chain planning tools. These solutions enable businesses to optimize inventory, streamline operations, and enhance customer experiences across various industries.

  Manhattan Associates financial statements

  Analysts recommendation: 2.07

  Financial Health

  • Return on assets (ROA): 29.45%
  • Return on equity (ROE): 73.58%
  • Return on investment (ROI): 60.52%

  Profitability

  • Gross margin: 55.94%
  • Operating margin: 25.91%
  • Net profit margin: 20.25%

  Growth

  • EPS (past 5 years): 21.66%
  • EPS (current): 3.52
  • EPS estimate (next quarter): 1.13
  • EPS growth (this year): 5.62%
  • EPS growth (next year): 9.03%
  • EPS growth (next 5 years): 8.87%
  • EPS growth (quarter-over-quarter): -6.58%
  • Sales growth (past 5 years): 11.02%
  • Sales growth (quarter-over-quarter): 3.42%

  💡 Why invest in Manhattan Associates?

  Like a comprehensive supply chain orchestrator, Manhattan Associates demonstrates compelling strengths for logistics software investors:

  • Revenue Growth Momentum: Manhattan Associates achieved record 2024 revenues of $1.04 billion with 12.2% year-over-year growth and 23.7% net income increase, demonstrating strong financial performance and operational execution.
  • Cloud Platform Innovation: The Manhattan Active platform delivers scalable microservices-based solutions enabling rapid deployment, continuous innovation, and superior supply chain optimization capabilities for modern enterprises.
  • Global Customer Diversification: Serving over 1,200 customers worldwide across retail, wholesale, and manufacturing sectors provides revenue stability, reduces concentration risk, and creates cross-selling opportunities.
  • Research Development Investment: Manhattan Associates invested $149.8 million in R&D during 2024, reflecting strong commitment to innovation, platform enhancement, and maintaining competitive technological advantages.

  🐌 Key considerations before investing in Manhattan Associates

  However, navigating profitability challenges and market dynamics presents significant risks for investors:

  • Earnings Decline Projection: Management projected 4% to 6% decrease in adjusted earnings per share for 2025 citing challenging macroeconomic conditions, creating near-term profitability concerns for investors.
  • Competitive Pressure Intensity: Manhattan Associates faces intense competition from major enterprise software vendors like Oracle and SAP in the supply chain management market, requiring continuous innovation investments.
  • Cloud Migration Challenge: With less than 20% of customer base on cloud solutions, the company faces significant execution risk migrating existing clients to cloud platform while maintaining service quality.
  • Stock Price Volatility: Following early 2025 profit warnings, Manhattan Associates stock experienced significant decline, highlighting potential volatility and investor sentiment sensitivity to earnings guidance changes.

  Final thoughts on Manhattan Associates

  Manhattan Associates' strong revenue growth, innovative cloud platform, and global customer base position it as a significant supply chain software provider. However, investors must weigh earnings decline projections, competitive pressures, and cloud migration execution risks that create near-term uncertainty. Like a supply chain optimization platform serving diverse industries, Manhattan Associates offers exposure to logistics digitalization with the benefits of market leadership balanced against profitability and transition challenges.

If you are interested in other stock categories, check out my other lists of the best tech, semiconductor, gold mining, retail, real estate, manufacturing, insurance, industrial, hotel, healthcare, financial, energy, defense, cybersecurity, construction, communication services, cloud, brokers, beauty, basic materials, automotive, AI, utility, european financial, european industrial, european tech, european retail, waste management, european, european defense, european construction stocks.