“The Cloud” has evolved from a budding innovation in tech into one of the largest factors driving growth in the technology sector in only a few years. Today, cloud computing is an integral part of software-related firms, which in turn has seen investors search for cloud-focused tech stocks.
In our increasingly mobile world, cloud computing has dramatically reshaped the way companies conduct business. The technology allows firms big and small, as well as individuals, to access all their vital information nearly anywhere. Cloud computing like the smartphone, is hardly a fad, and it seems nearly impossible to think that people will reverse course—unless the cybersecurity concerns become too high.
Think how much market share Amazon’s AWS cloud business was able to gain based on its significant head start into the now booming market over rivals and fellow giants Microsoft MSFT, IBM IBM, and Google GOOGL. With this in mind, we have highlighted three stocks that are not only showing strong cloud-related activity but also strong fundamental metrics.
Check out these three Zacks buy-ranked cloud stocks to consider right now.
1. Veeva Systems Inc. VEEV
Veeva makes cloud-based solutions for the pharmaceutical and life sciences industries. Its main offerings are presented in a software-as-a-service model and deliver industry-specific tools for CRM, content management, and many other enterprise applications. Shares of VEEV have skyrocketed 98% over the last 12 months and 54% in 2019, to help the company hit multiple new highs along the way.
Looking ahead, our current Zacks Consensus Estimate calls for the company’s first quarter fiscal 2020 revenue to jump over 22% to reach $238.7 million. Meanwhile, Veeva’s full-year revenue is expected to surge nearly 20% to reach $1.03 billion. At the bottom end of the income statement, the company’s adjusted Q1 earnings are projected to pop 36.4%. Furthermore, Veeva has experienced a ton of positive, short-term and longer-term earnings estimate revisions recently that help it earn a Zacks Rank #2 (Buy).
2. Cloudera Inc. CLDR
Cloudera is a provider of cloud-based big data solutions. The firm delivers an open-source distribution platform that enables efficient and secure data management and analytics. Cloudera is also focused on being scalable across large organizations, and its client list includes the likes of Facebook FB and Google. With that said, CLDR stock has taken a hit over the last year, down 22%, which could help set up a solid buying opportunity for those high on the cloud firm.
Jumping back a bit further, investors should note that CLDR stock has been a rollercoaster since debuting in April 2017. Still, the company looks poised to push toward profitability in fiscal 2021 and its strong revenue growth projections make Cloudera look attractive right now. The company’s Q1 revenue is expected to soar 83%, with full-year sales projected to climb 77%. Cloudera is a Zacks Rank #2 (Buy) at the moment and also sports a “B” grade for Growth and an “A” for Momentum in our Style Scores system.
3. Amazon AMZN
As we touched on at the top, Amazon remains the undisputed cloud computing champion. And its share of the total U.S. e-commerce market is projected to reach 52.4% in 2019, up from 48% last year, according to eMarketer. The company’s AWS business also looks poised to help boost Amazon’s earnings. In fact, Jeff Bezos’ company is expected to see its adjusted Q1 2019 earnings—which are due out after the closing bell on Thursday, April 25—soar roughly 41%. Peeking further down the road, Amazon’s full-year EPS figure is projected to jump 33% this year and surge nearly 50% higher than our 2019 estimate in the following year.
On top of that, AMZN’s revenue is projected to climb 17% in the first quarter and 18% in fiscal 2019. Amazon is currently a Zacks Rank #2 (Buy) that rocks “A” grades for Growth and Momentum. Lastly, the firm has started to trade at a more reasonable P/E and its 4.1 price/sales ratio sits well below its Chinese counterpart Alibaba’s BABA 9.3.