© Reuters. Top 3 SaaS Stocks For May
The SaaS business model is becoming the norm for the software industry. While many SaaS stocks saw huge gains in 2020, we need to be more selective this year. For this reason, David Cohne recommends Salesforce.com (CRM), Microsoft (MSFT), and Adobe (NASDAQ 🙂 as top SaaS stocks for May. Twenty years ago, very few companies had Software-as-a-Service (SaaS) business models. But now that has changed as it is widespread in the software industry. SaaS is a type of licensing model in which access to software is provided on a subscription basis. The software is located on an external server. Customers access it through a web browser rather than their computer's hard drives.
The SaaS business model has largely become synonymous with the rise of the cloud as software is accessed through the cloud. Software hosted in the cloud not only provides companies with a time-saving option to update their software, it is also more cost-effective for customers. In the past, consumers had to buy multiple software products at the same time, which could be very costly. The SaaS model, on the other hand, makes it much cheaper, especially at the front end.
For a SaaS company, the subscription model provides a steady stream of revenue rather than convincing its customers to upgrade to new products. With so many SaaS companies, it can be difficult for investors to narrow down their choices. Because of this, I've narrowed my list to SaaS stocks with solid growth catalysts and buy reviews on our POWR ratings service. That's why I highlight Salesforce.com Inc (NYSE :). Microsoft Corp. . (NASDAQ 🙂 and Adobe Inc. (ADBE) below.
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