How to invest in US cloud software stocks? Piper Sandler strongly recommends "MAC"
Piper Sandler strongly recommends Adobe, MongoDB, and Salesforce as the top choices for cloud software investments. Analyst Brent Bracelin suggests investors to increase their investments in these three stocks, despite their prices still being below the 52-week high. MongoDB is expected to recover from its low point, while Adobe is poised for a rebound with new AI products. Salesforce has declined in the past six months but still has upside potential. Piper Sandler has assigned a "neutral" rating to all three stocks and set target prices
According to the Zhītōng Finance APP, Piper Sandler believes that Adobe (ADBE.US), MongoDB (MDB.US), and Salesforce (CRM.US) are the most worthwhile investment stocks in cloud software.
Piper Sandler analysts led by Brent Bracelin stated: "We recommend large-cap growth investors to take on more risk and increase their position in 'MAC'." MAC refers to Adobe, MongoDB, and Salesforce.
Bracelin added: "These are stocks that have underperformed market expectations, with average prices still 26% below their 52-week highs, despite having healthy product and profit catalysts, as well as favorable risk-return profiles."
After hitting a low point in the second quarter, MongoDB may accelerate its growth in the future. MongoDB's stock price has already fallen by 29% this year. Piper Sandler believes that as a high-quality database franchise operator, the stock is expected to recover the 29% decline over the next few quarters and reach $335.
Adobe's situation is similar, and with the benefit of its latest artificial intelligence products, the stock is expected to recover this year.
Piper Sandler pointed out: "The new innovation product cycle is underestimated, which may help revitalize growth."
Salesforce's stock price has risen by 9% this year, but has fallen by nearly 5% in the past six months.
Bracelin noted: "We believe Salesforce will rise by 11% to $325, and in a bullish scenario, it could rise by 39% to $405."
Piper Sandler rates Adobe as "overweight" with a target price of $635; rates Salesforce as "overweight" with a target price of $325; rates MongoDB as "overweight" with a target price of $335