2 Stocks Will Benefit Greatly If the Big Banks Move to the Cloud

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Almost 25% of global enterprise information technology (IT) spending is doled out by the financial services industry, which includes insurance companies, and when you think about the tremendous daily demands on the companies in the sector, that huge number seems realistic.

One thing that the big banks and financial services firms have been slow to adopt is moving to the public cloud because of the obvious regulatory, security and legacy IT issues.

A new research report from Deutsche Bank notes that recent anecdotal evidence seems to suggest that the large banks and financial services leaders are considering moving to the cloud for computing or infrastructure workloads, and that adoption could start to ramp materially next year.

Given the level of spending required, this business could be huge, and the Deutsche Bank team sees two industry giants benefiting and both are rated Buy.

Amazon

This company is the absolute leader in online retail, and it is also a dominant player in cloud storage business. Amazon.com Inc. (NASDAQ: AMZN) serves consumers through retail websites, which primarily include merchandise and content purchased for resale from vendors and those offered by third-party sellers. In addition, the company serves developers and enterprises through Amazon Web Services (AWS), which provides compute, storage, database, analytics, applications and deployment services that enable virtually various businesses.

AWS is the undisputed leader in the cloud now, and many top analysts team see the company expanding and moving up the enterprise information value chain and Addressing a larger total available market. The company has had numerous recent product announcements, including Aurora for relational database engine, Quicksight for business intelligence and AWS Database Migration Support Service.