Apps & Software

Goldman Sachs Very Bullish on Cloud Software: 6 Red-Hot Stocks to Buy Now

Splunk

This stock is one of the top picks in the group across Wall Street. Splunk Inc. (NASDAQ: SPLK) provides a software platform for collecting, storing, indexing, searching and analyzing machine-generated data, such as log files and configuration files, which are prevalent in every type of IT system, device and application.

Splunk technology is potentially applicable and disruptive in several market segments, including IT operations, security and compliance, and business intelligence. These market segments are collectively worth $28 billion today.

Wall Street analysts agree that the company offers the de facto standard for security information and event management. It also offers orchestration solutions for security operations, a fast emerging category of products.

Goldman Sachs has set a $240 price target. The consensus target is $203.51, Splunk stock was last seen on Monday at trading $171.91 a share.

Workday

This company rounds out the top picks at Goldman Sachs in the cloud software space and is another industry leader. Workday Inc. (NASDAQ: WDAY) provides enterprise cloud applications worldwide. Its applications help its customers to manage critical business functions and optimize their financial and human capital resources.

Its Workday Financial Management application provides functions of general ledger, accounting, accounts payable and receivable, cash and asset management, revenue management and grants management, as well as project and resource management, time and expense tracking, project billing, revenue recognition, financial reporting and analytics.

It also provides Workday Human Capital Management application, which includes human resources management, such as workforce lifecycle and organization management, compensation, absence and employee benefits administration. It also includes global talent management, comprising goal and performance management, succession planning and career and development planning, as well as Skills cloud, a machine-learning-powered universal skills language to help source, utilize, develop and retain talent.

The Goldman Sachs price objective for Workday stock is $300. That compares with the lower $255.84 consensus target and Monday’s closing price of $234.99 a share.


These are six top cloud computing stocks for investors with plenty of risk tolerance to consider for aggressive growth portfolios. With earnings on the way for many, including one today, and the market fully priced at current levels, it may make sense to scale buy positions, and see how the results come in.