Technology

4 Small Cap Technology Stocks That Portfolio Managers Love

Manhattan Associates

Merrill Lynch indicated that a whopping 41.2% of the funds surveyed owned this company. Manhattan Associates Inc. (NASDAQ: MANH) makes commerce-ready supply chains that bring all points of commerce together customers are ready to sell and ready to execute. Across the store, through the network or from the fulfillment center, the company can design, build and deliver market-leading solutions that support both top-line growth and bottom-line profitability. By converging front-end sales with back-end supply chain execution, the software, platform technology and unmatched experience help the customers get commerce ready and ready to also reap the benefits of the omni-channel marketplace.

With consumer discretionary dollars starting to jump from lower gas prices and an improving economy, it makes sense that more and more retail outlets will use the kind of products that Manhattan Associates provides to streamline everything from ordering to inventories to delivery.

The consensus price target is $69, and the shares closed Monday at $61.31.

Ultimate Software

This stock is owned by 41.2% of the funds that the Merrill Lynch team surveyed. Ultimate Software Group Inc. (NASDAQ: ULTI) is a leading provider of cloud-based human capital management (HCM) solutions, with more than 20 million people records in the cloud. Ultimate’s award-winning UltiPro delivers HR, payroll, talent and time and labor management solutions that connect people with the information they need to work more effectively.

The demand for predictive analytics in the area of HCM is rapidly increasing, as businesses are seeing the value of big data and data modeling across many areas of the business, such as expense management and inventory management. While the market cap of the stock barely stays in the small-cap range at $5.24 billion, the shares have had a solid year and the recent pullback gives investors a better entry point.

The consensus price objective is set at $194.61. The stock ended Monday at $183.38 per share.

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Again, just because a large percentage of portfolio managers like these stocks isn’t always a reason to buy them. However, the top funds employ highly paid analysts to do stringent research on companies, and those that are widely owned generally have outstanding attributes.