The Dow Jones, S&P 500 and Nasdaq all jumped again early Thursday afternoon, as part of a larger market rally of more than two weeks. The recent positivity comes behind the signs that social distancing is working in the United States and elsewhere to help flatten the curve of coronaviruses.
In addition, the Fed unveiled another set of programs on Thursday in its efforts to support the US economy in the context of the coronavirus economic slowdown, which was highlighted by 6.6 million more people who claimed unemployment benefits last week.
The S&P 500 is now technically in a new bull market, up more than 20% from its lows of March 23, officially joining the Dow Jones, which crossed this range in just a few days. These ultra-rapid climbs highlight why the total withdrawal from the market during periods of slowdown and volatility often prevents investors from seizing large rebounds.
However, volatility could remain because no one really knows when the economy will start to return to near normal levels. That said, investors may want to start buying stocks or at least adding them to their watch lists.
With that in mind, let’s delve into three cloud-based technology stocks that look like solid long-term purchases …
Anaplan, Inc. PLAN
Anaplan develops cloud-based SaaS platforms for all areas, from finance to supply chains. The goal is to help its more than 1,400 clients around the world to improve their planning and decision-making in real time. The San Francisco-based company exceeded our fourth quarter revenue and revenue estimates at the end of February, with annual sales up 45% to $ 348 million.
Looking to the future, our current Zacks estimates predict that Anaplan’s revenues will exceed 30% in fiscal 2021 and 27.5% next year to $ 577.3 million. The company is expected to post a slightly larger adjusted loss this year. But its adjusted loss for fiscal 22 should be reduced by almost half. PLAN has also overwritten our earnings estimates by an average of 31% over the past four quarters.
Anaplan shares have jumped almost 30% since March 23 and have increased by around 50% since their IPO in October 2018. Despite the recent execution and overall strength, Anaplan’s shares have been more from 40% below their 52-week highs, at around $ 63, to around Thursday, $ 36 per share, which could give the stock a lot more room to climb.
Anaplan is currently a Zacks Rank # 2 (Buy) that is part of any industry that is among the 35% of the more than 250 Zacks industries that growth-conscious investors might want to consider.
CrowdStrike Holdings Inc. CRWD
CrowdStrike is a cybersecurity company founded in 2011 in the era of cloud computing. CRWD’s multi-tenant, cloud-native and artificial intelligence security solutions for endpoints and more have attracted thousands of customers to its various cybersecurity offerings based on a SaaS subscription. On March 19, CRWD announced a much smaller than expected adjusted loss in the fourth quarter and its total sales for fiscal 2020 soared 93%.
The company also added 870 new net subscribers in the fourth quarter to end fiscal 2020 with approximately 5,400 customers. The CEO of CRWD said in his call for results that he was landing bigger customers and explained why he was well positioned for the long term and for the economy of coronaviruses. The main reason is that cyber threats do not sleep and that they could even increase with more people working remotely.
CRWD’s sales for fiscal 2021 are expected to increase by more than 51% to $ 730 million, and the adjusted loss for the fiscal year is expected to decrease from – $ 0.42 to – $ 0.12 per share. It should then post an adjusted positive EPS of + $ 0.16 per share during fiscal year 22. CrowdStrike’s positive review activity results in Zacks Rank # 2 (Buy), alongside his “A” scores for growth and momentum in our style score system.
In addition, CRWD stocks have soared more than 80% since mid-March. Still, at around $ 60 per share, the CrowdStrike share is still 40% below its 52-week highs.
Microsoft hasn’t needed an introduction for decades, but its expansion into cloud computing has turned the historic tech giant into a growing company and into stocks once again. MSFT stocks have jumped 22% since mid-March, but remain at around 14% of their February highs, despite rising more than 35% in the past 12 months. The company joined Apple AAPL and many others when it warned Wall Street in late February that it would likely not meet its quarterly sales forecast for its More Personal Computing segment.
Fortunately, MSFT said that its forecast for the third quarter “remains unchanged” for its other units. That’s a good sign, as Microsoft’s cloud computing segment recently spurred growth, as smart cloud revenues increased 27% in the last quarter. Microsoft’s growing cloud segment, which competes with Amazon AMZN for industry supremacy, is poised to move the business forward.
Microsoft’s adjusted profits are expected to increase by more than 17% and 11.5%, respectively in fiscal years 2020 and 2021, and revenues are expected to jump 11.6% and 11%. MSFT is currently a Zacks Rank # 3 (Hold) which appears to be one of the safest investments on the market today. Microsoft also provides investors with much-needed income at the moment, with a dividend yield of 1.24% that easily exceeds 0.72% of the 10-year US Treasury.
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