The first week of the new earnings season is out of the way, and the big week is coming up, albeit shortened due to the Martin Luther King holiday. One thing is for sure, with a pricey market — the S&P 500 is trading at almost 17 times forward earnings estimates — investors need to be cautious as any miss or weak forward guidance will probably be rewarded with some steep selling.

One area that should be solid is software, and while not all companies are created equal, there is a good chance that some companies can come in and not only beat current estimates, but maybe also give solid forward guidance.

In a new RBC research report, the software team is positive on six companies going into earnings. We screened the list for the four that appear to have the best upside potential, not only for the first quarter, but for 2017 as a whole. All of these stocks are rated Buy at RBC.

HubSpot

This stock has sold off some since November and is offering a nice entry point. HubSpot Inc. (NYSE: HUBS) provides a cloud-based marketing and sales software platform for businesses in the Americas, Europe and the Asia-Pacific. Its software platform includes integrated applications, such as social media, search engine optimization, blogging, website content management, marketing automation, email, customer relationship management, analytics and reporting that enables businesses to attract visitors to their websites, convert visitors into leads and close leads into customers. The company also offers professional and phone and email-based support services.

The company posted strong billings growth of 48% when it reported in November. The company also has an impressive 20% increase in net new customers. The analysts noted in their report:

The pro sales product now has over 5000 customers, and is becoming a contributor to growth and has great potential to improve unit retention across the base, although we will keep a close eye on the potential re-org of the go to market strategy in early 2017.

The RBC price target for the stock is $70, and the Wall Street consensus target is $65.26. The shares closed last Friday at $51.60.

ServiceNow

This could be among the fastest growing of the RBC Outperform-rated stocks and is the firm’s top pick. ServiceNow Inc. (NYSE: NOW) expects to have 50% of the Global 2000 customers by 2020, adding 15 to 20 each quarter. ServiceNow is the enterprise IT cloud company with a service used to create a single system of record for IT and automate manual tasks, standardize processes and consolidate legacy systems. Using the company’s extensible platform, customers can create custom applications and evolve the IT service model to service domains inside and outside the enterprise.

Customers use the firm’s service model to define, structure and automate the flow of work, removing dependencies on email and spreadsheets to transform the delivery and management of services for the enterprise. Service Now enables service management for every department in the enterprise, including IT, human resources, facilities, field service and more.

The analysts said this in a recent report:

We believe 2017 consensus revenue growth of 30% remains conservative following an estimated 38%+ in 2016. We also believe billings should be able to grow north of 30% in 2017 following an estimated 36% in 2016.Both revenue and billings could re-accelerate on a quarter to quarter basis in the first quarter of 2017.

RBC has a $95 price target for the stock, and the consensus target is $93.41. The shares closed Friday at $83.53.

Proofpoint

This company has long been mentioned as a potential takeover candidate. Proofpoint Inc. (NASDAQ: PFPT) provides threat protection, incident response, regulatory compliance, archiving, governance, eDiscovery and secure communication solutions worldwide. Its security-as-a-service solutions comprises an integrated suite of on-demand data protection solutions that enable large and midsized organizations to defend, protect, archive and govern their sensitive data.

The company provides Proofpoint Enterprise Protection, a communications and collaboration security suite designed to protect customers’ mission-critical messaging infrastructure from outside threats, including spam, phishing, unpredictable email volumes, malware and other forms of objectionable or dangerous content before they reach the enterprise.

The company has reported outstanding results, and the analysts feel it continues to separate itself from its peers as related to execution and momentum. They also see the company’s 2017 growth rates to move up from the current 29% or so level, which is in line with the compounded annual growth rate they expect going to 2020. The stock remains one of the analysts’ favorite long-term plays in the security arena.

The $85 RBC price target is less than the consensus target of $88.04. The stock closed last Friday at $81.89.

Shopify

This one really could surprise to the upside. Shopify Inc. (NASDAQ: SHOP) provides a cloud-based and multi-channel commerce platform for small and medium-sized businesses. Its platform provides merchants with a single view of their business and customers in various sales channels, including web and mobile storefronts, social media storefronts, mobile apps and physical retail locations, and it enables them to manage products and inventory, process orders and payments, ship orders, build customer relationships and leverage analytics and reporting.

Shopify designs, sets up and manages online stores for companies ranging from massive multi-billion-dollar entities to solo entrepreneurs just starting out. Shopify has been gaining new merchants on its platform at an incredible rate, more than doubling in the most recent quarter year over year to 325,000. Those merchants sold more than $3.8 billion during the quarter. The company has yet to report a profit, and the RBC team noted in their research:

We view ours and consensus numbers as low given seasonality, underlying merchant and merchant economic trends. Shopify beat consensus revenue by 5% in the third quarter versus the average 8% of the prior 2 quarters. Investors remain focused on sustainability of growth, operating leverage, fundamental impact of partnerships , progress on quality of MRR and merchant additions, and any further insights into unit economics, especially against heightened expectations.

The RBC price objective is $52. The consensus target is $51.35, and shares closed last Friday at $48.10.

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While there is no guarantee any of these companies surprise to the upside, the stars appear to be aligning for all of them, and the odds based on past performance look good as well. Even if they only meet expectations, they all remain solid holdings for aggressive growth accounts with risk tolerance.

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