Bank of America has identified several top software stocks to watch for 2025, including Salesforce (CRM, Financial), HubSpot (HUBS), Microsoft (MSFT), and ServiceNow (NOW). According to analysts, despite significant growth in the U.S. software sector in 2023 and 2024, current stock prices may not fully account for the potential growth fueled by Agentic AI, changes in corporate IT spending, and the ongoing shift to cloud computing.
Analysts suggest that Agentic AI could be the next growth driver for software companies, with some software already demonstrating advanced intelligence that might replace workers by late 2025. Salesforce is seen as a leader in the Agentic AI front-end space, while HubSpot's focus on small and medium-sized businesses could provide a unique entry point into the AI realm.
Microsoft is well-positioned with its infrastructure and applications, and ServiceNow continues to achieve top growth levels with its robust back-end systems and cloud/AI platform. Other notable software companies include Datadog (DDOG), with its impressive growth and cash flow, and Gitlab (GTLB), which is expanding its DevOps market share through AI.
Global-E Online (GLBE) is becoming a standard setter in the cross-border e-commerce market. Five9 (FIVN) is experiencing improving end markets and attractive valuation, while monday.com (MNDY) boasts revenue growth of 20% or more. Asana (ASAN) has reached a turning point, with performance expectations likely to be revised upward.
