In this article, we discuss the 10 remote work stocks to buy now.
Remote work stocks have started climbing again as a new variant of COVID-19, dubbed Omicron, makes waves across the world. With the threat of lockdowns looming again, businesses that had barely begun to shift people back to offices after a lengthy time working from home are once again faced with the possibility of going completely digital. Some tech executives have even announced that they will be moving to permanent remote work setups. A report by freelance platform company Upwork claims that by 2025 more than 36 million Americans will be working remotely.
Before the pandemic, only around 16 million Americans had work-from-home setups. The huge increase in just a few months underlines that the remote work revolution is already underway. As cybersecurity improves, cloud-based technologies become faster, and hybrid working models take center stage, remote work trends could continue well beyond pandemic fears. The spending on communications infrastructure in the US over the next few years, under the Biden Infrastructure Plan, could also be a key factor driving the adoption of remote work.
The companies that have already shifted to cloud-based work models, like Microsoft Corporation (NASDAQ:MSFT), Salesforce.com, Inc. (NYSE:CRM), and Atlassian Corporation Plc (NASDAQ:TEAM), among others discussed in detail below, will most likely benefit from this shift. Those who are late to the party will inevitably have to face the consequences of indecision in this regard.
Our Methodology
These were picked based on business fundamentals and analyst ratings. The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey.
Photo by Glenn Taubenfeld on Unsplash
Remote Work Stocks to Buy Now
10. Citrix Systems, Inc. (NASDAQ:CTXS)
Number of Hedge Fund Holders: 24
Citrix Systems, Inc. (NASDAQ:CTXS) is an enterprise software firm that provides workplace, security, and other professional services. Some of the remote work solutions offered by the firm include cloud-based file sharing and storage, mobility and device management, as well as protected internet access.
Citrix Systems, Inc. (NASDAQ:CTXS) recently beat market estimates on earnings per share and revenue for the third quarter by $0.25 and $7.8 million respectively. However, the guidance numbers fell short of expectations.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Cantillon Capital Management is a leading shareholder in Citrix Systems, Inc. (NASDAQ:CTXS) with 2.5 million shares worth more than $277 million.
Just like Microsoft Corporation (NASDAQ:MSFT), Salesforce.com, Inc. (NYSE:CRM), and Atlassian Corporation Plc (NASDAQ:TEAM), Citrix Systems, Inc. (NASDAQ:CTXS) is one of the stocks on the radar of hedge funds.
9. Fiverr International Ltd. (NYSE:FVRR)
Number of Hedge Fund Holders: 29
Fiverr International Ltd. (NYSE:FVRR) owns and runs an online marketplace for talent. This marketplace boasts at least 500 categories of work. It also offers a separate platform for those selling their talent to manage tasks, prepare invoices, and sign contracts.
MKM Partners analyst Rohit Kulkarni recently raised the price target on Fiverr International Ltd. (NYSE:FVRR) stock to $175 from $170 but kept a Neutral rating on the shares, noting that the third quarter earnings of the firm were “better than expected”.
At the end of the third quarter of 2021, 29 hedge funds in the database of Insider Monkey held stakes worth $520 million in Fiverr International Ltd. (NYSE:FVRR).
In its Q1 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Fiverr International Ltd. (NYSE:FVRR) was one of them. Here is what the fund said:
“We sold out of Fiverr International Ltd., the marketplace for freelance services, since the stock ran up multiple fold since our purchase less than a year ago and traded at a valuation that we thought captured much of the future opportunity.”
8. Upwork Inc. (NASDAQ:UPWK)
Number of Hedge Fund Holders: 35
Upwork Inc. (NASDAQ:UPWK) provides online human resource and employment services. The firm has hundreds of thousands of core active clients on the Upwork platform and employers spend $2.5 billion there on different services annually.
Upwork Inc. (NASDAQ:UPWK) recently posted earnings for the third quarter, reporting earnings per share of $0.04, beating estimates by $0.13. The revenue over the period was $128 million, up 32% year-on-year.
At the end of the third quarter of 2021, 35 hedge funds in the database of Insider Monkey held stakes worth $418 million in Upwork Inc. (NASDAQ:UPWK), up from 26 in the preceding quarter worth $427 million.
In its Q4 2020 investor letter, Spree Capital Advisers, an asset management firm, highlighted a few stocks and Upwork Inc. (NASDAQ:UPWK) was one of them. Here is what the fund said:
“Early in the fourth quarter we meaningfully increased our position size in Upwork (UPWK). Upwork is a global employment marketplace that enables businesses to vet, hire, and manage talent as part of their distributed workforce. Upwork facilitates labor and demand side connectivity on a global scale by providing the infrastructure to create trust and to streamline talent sourcing, contracting, analysis and payment. Freelancers benefit from having a reputation ranking system that feeds their marketing channels, allowing them to have access to quality, flexible work and on time compensation. Businesses on the demand side benefit by having extensive access to specialized talent, enabling faster and more cost effective hiring, and by having the strategic optionality inherent in the ability to flex a portion of their workforce based on changing demand requirements.
Labor markets have long had unnecessary frictional inefficiencies driven by regional talent imbalances and long-term trends of increased specialization of labor and declining labor mobility. Meanwhile, innovations in communication and global connectivity have transformed the way work gets done. Knowledge workers seek the flexibility and geographic advantages of on demand work, but the barrier to adoption has historically been established habits and work standards on the demand side. The Covid-19 global pandemic has broken down those barriers. We see three steps in the path to enterprise usage and shareholder value creation.
First, Upwork is reducing frictional barriers to on demand labor adoption on the demand side by modularizing the most common jobs served on the platform. Project Catalog is a collection of predefined projects that businesses purchase through an e-commerce purchase experience. Users on the demand side benefit from a frictionless way to purchase well defined, quality verified tasks to augment more complex work being done by full time employees. On demand workers on the supply side benefit from having a new avenue to market and sell the services they consistently perform. Importantly, Project Catalog widens the customer acquisition funnel by providing an easy on ramp for new customers to source and connect with talent, enabling businesses to quickly start with small projects and scale to larger and longer-term projects and relationships.
Second, Upwork is shifting its go to market strategy to target large enterprises. Currently, enterprise customers with more than 100 employees account for 20% of Upwork’s $2.7 billion in gross services volume. As part of shifting the go to market strategy, small and medium sized business customers will move to a fully self-service offering, allowing Upwork’s sales force to focus on capturing the $3.5 trillion in gross services volume that large enterprise customers currently spend on contingent labor. As Upwork’s sales team targets the large underserved market opportunity presented by enterprise customers and raises awareness of the quality verified modular work units available in Project Catalogue, there is a long runway for Upwork to power offline to online conversion in the on demand labor marketplace while breaking down the barriers to adoption and growing the overall size of the market.
Third, Upwork is evolving..”[read the entire letter here]
7. DocuSign, Inc. (NASDAQ:DOCU)
Number of Hedge Fund Holders: 51
DocuSign, Inc. (NASDAQ:DOCU) is a software firm most famous for providing e-signature solutions. These allow businesses to digitally prepare, sign, and manage agreements. The firm aims to automate workflows through this process.
DocuSign, Inc. (NASDAQ:DOCU) recently announced that it would be partnering with software giant Salesforce to develop an artificial intelligence-based solution aimed at further automating the contract processes between businesses.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Tiger Global Management LLC is a leading shareholder in DocuSign, Inc. (NASDAQ:DOCU) with 7.3 million shares worth more than $1.8 billion.
In its Q2 2021 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and DocuSign, Inc. (NASDAQ:DOCU) was one of them. Here is what the fund said:
“DocuSign provides electronic signature solutions. The firm reported an excellent quarter and investors have appreciated the strong growth combined with the excellent margins the company has posted. DocuSign has a long runway of growth ahead and we believe that it remains in a favorable position to continue gaining market share from traditional manual and paper-based signature solutions.”
6. Zoom Video Communications, Inc. (NASDAQ:ZM)
Number of Hedge Fund Holders: 56
Zoom Video Communications, Inc. (NASDAQ:ZM) owns and runs a video communications platform. The platform has gained hundreds of millions of users in the past two years as more businesses opt for remote working solutions, using the Zoom platform to communicate.
Wells Fargo analyst Michael Turrin has an Equal Weight rating on Zoom Video Communications, Inc. (NASDAQ:ZM) stock with a price target of $245. In an investor note, the analyst underlined that the revenue growth and operational margins for the firm were among the best in the software industry.
Among the hedge funds being tracked by Insider Monkey, New York-based firm Tiger Global Management LLC is a leading shareholder in Zoom Video Communications, Inc. (NASDAQ:ZM) with 4.7 million shares worth more than $1.2 billion.
In addition to Microsoft Corporation (NASDAQ:MSFT), Salesforce.com, Inc. (NYSE:CRM), and Atlassian Corporation Plc (NASDAQ:TEAM), Zoom Video Communications, Inc. (NASDAQ:ZM) is one of the stocks attracting the attention of elite investors.
In its Q1 2021 investor letter, Artisan Partners, an asset management firm, highlighted a few stocks and Zoom Video Communications, Inc. (NASDAQ:ZM) was one of them. Here is what the fund said:
“We concluded our campaigns in Zoom Video Communications. We have been paring our position in Zoom for several quarters, anticipating the reduced need for video conferencing as vaccination rates climb and people return to their workplaces. That said, we believe there is a strong case to be made that the pandemic has prompted a permanent inflection in videoconferencing’s importance—sustainably higher remote work arrangements, more online learning and less business travel. Furthermore, the company’s dramatically expanded user base (up 485% YoY in Q3) positions it well to cross sell additional services, Zoom Phone in particular. The long-term future remains bright, but we decided to end our successful investment campaign in favor of opportunities in our pipeline with more attractive near-term growth prospects.”
5. Atlassian Corporation Plc (NASDAQ:TEAM)
Number of Hedge Fund Holders: 60
Atlassian Corporation Plc (NASDAQ:TEAM) makes and sells various software products. Some of the remote work solutions offered by the company include JIRA, a workflow management system, and Opsgenie, an incident management tool.
On October 29, investment advisory Oppenheimer reiterated an Outperform rating on Atlassian Corporation Plc (NASDAQ:TEAM) stock and raised the price target to $500 from $420, highlighting that the cloud migration of the firm was “unfolding smoothly”.
At the end of the third quarter of 2021, 60 hedge funds in the database of Insider Monkey held stakes worth $6 billion in Atlassian Corporation Plc (NASDAQ:TEAM).
Here is what Baron Opportunity Fund has to say about Atlassian Corporation Plc (NASDAQ:TEAM) in its Q2 2021 investor letter:
“Atlassian Corporation Plc is a software leader that makes tools that are used by thousands of teams worldwide, thus its ticker TEAM. Atlassian’s tools “help teams collaborate, build, and create together” (quote from Atlassian’s website), with an emphasis on designing, developing, and maintaining software, including JIRA for team planning and project management, Confluence for team content creation and sharing, HipChat for team messaging and communications, Bitbucket for team software code sharing and management, and JIRA Service Desk for team services and support use cases. Atlassian is the recognized market leader for information technology team planning and project management software, and has extended its product offering into tangential areas, such as those listed above. The company is in the midst of transitioning its business model to the cloud, which will help it drive faster product innovation, more seamlessly integrate its product families, and raise the effective price realization for its suite of products. Atlassian is run by its two visionary founders, has strong competitive advantages, and we think it should be able to grow revenue over 25% for many years with best-in-class free cash flow margins.”
4. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 87
ServiceNow, Inc. (NYSE:NOW) provides enterprise cloud computing solutions. The Now platform is one of the most advanced cloud systems, using artificial intelligence and machine learning to perform analytics and automate workflows.
In late October, ServiceNow, Inc. (NYSE:NOW) posted third quarter earnings, smashing market estimates on earnings per share and revenue by $0.16 and $30 million respectively. The firm also topped expectations on subscription revenue.
Among the hedge funds being tracked by Insider Monkey, Connecticut-based investment firm Lone Pine Capital is a leading shareholder in ServiceNow, Inc. (NYSE:NOW) with 2.1 million shares worth more than $1.3 billion.
In its Q1 2021 investor letter, Palm Capital, an asset management firm, highlighted a few stocks and ServiceNow, Inc. (NYSE:NOW) was one of them. Here is what the fund said:
“ServiceNow provides software solutions to structure and automate various task and processes for large businesses. The company began in 2004 with a solution to help businesses manage the IT services they offer employees and customers. Unlike the existing solutions in the market, ServiceNow’s offering was built using modern architecture that was flexible, modular, and user-friendly. And it left the incumbents – large companies such as BMC, IBM and MicroFocus – playing catch up.
As the company grew to dominate this market, it saw the opportunity to expand its offering to include the broader task of IT Operations Management – or the monitoring and control of an entire business’s IT infrastructure. And over time its success in improving productivity and user experience in IT resulted in customers asking the company to expand its offering into other business workflows including HR Management and Customer Services – which it has since done.
All ServiceNow’s applications (including those built by customers and third parties) are built on its ‘Now’ platform. This allows the company and its customers to innovate and deploy new solutions quickly. And it helps ServiceNow gather a large amount of data to gain insights into and use machine learning to build solutions to meet customer needs in other areas. Crucially, this platform can interface with other SaaS and legacy software services used by its customers. Not only does this allow an IT department to manage all the myriad software services used by a business from a single point of control, it also reduces the operational disruption risk for those transitioning from legacy software systems to the cloud.
Aside from the ease of use of ServiceNow’s offerings, the other factor driving its growth is that its ‘land and expand’ strategy starts in the IT department of customers – the very department whose task it is to recommend other software solutions for businesses. It is therefore no surprise that more than 75% of ServiceNow’s customers use more than one of its products and 80% of its new business is from existing clients.
The company now serves…”[read the entire letter here]
3. Twilio Inc. (NYSE:TWLO)
Number of Hedge Fund Holders: 96
Twilio Inc. (NYSE:TWLO) owns and runs a cloud communications platform. One of the benefits of the platform for remote work is that it allows developers to integrate customer engagement and management tools within the software applications.
Twilio Inc. (NYSE:TWLO) recently posted earnings for the third quarter, reporting earnings per share of $0.01, beating estimates by $0.15. The revenue over the period was $740 million, up 65% year-on-year.
Among the hedge funds being tracked by Insider Monkey, California-based investment firm SCGE Management is a leading shareholder in Twilio Inc. (NYSE: TWLO) with 2.7 million shares worth more than $887 million.
2. Salesforce.com, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 119
Salesforce.com, Inc. (NYSE:CRM) is a California-based firm that markets cloud computing solutions. In July, the firm completed the purchase of Slack, one of the most famous workplace communication platforms across the world.
Jefferies analyst Brent Thill recently maintained a Buy rating on Salesforce.com, Inc. (NYSE:CRM) stock and raised the price target to $360 from $325, backing the firm to smash market estimates on earnings for the third quarter.
Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Salesforce.com, Inc. (NYSE:CRM) with 13.9 million shares worth more than $3.7 billion.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Salesforce.com, Inc. (NYSE:CRM) was one of them. Here is what the fund said:
“We added to our software-as-a-service (SaaS) exposure with the initiation of SaaS leader salesforce.com, which develops software for customer relationship management (we added Workday, which enterprise resource planning applications, last quarter). Saleforce.com is well-positioned in the most attractive end markets in software and will benefit from secular drivers such as remote work and the digital transformation. Salesforce.com is a sustainability leader as well, with a commitment to carbon-neutral cloud, toward which it has set a goal of 100% renewable energy for global operations by fiscal year 2022. The company has a strong focus on equality, in terms of equal rights, pay, education and opportunity. As a data company it has been leading on workforce disclosures and seeks to have 50% of its U.S. workforce made up of underrepresented groups by 2024.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 250
Microsoft Corporation (NASDAQ:MSFT) is a diversified technology company. Some of the products of the firm that are used for remote work include Microsoft Teams, Office 365, and Skype, among others.
Wells Fargo analyst Micahel Turrin recently initiated coverage of Microsoft Corporation (NASDAQ:MSFT) stock with an Overweight rating and a price target of $400, noting that the firm “still had a bright future ahead” despite becoming the largest company on the planet.
At the end of the third quarter of 2021, 250 hedge funds in the database of Insider Monkey held stakes worth $6.5 billion in Microsoft Corporation (NASDAQ:MSFT), up from 238 in the preceding quarter worth $6.2 billion.
In its Q1 2021 investor letter, Polen Capital, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“We have written extensively about Microsoft in recent commentaries. It was our leading contributor last year and one of our largest weightings within the Portfolio. It continues to experience business momentum through several dominant, essential, and competitively advantaged businesses, like Office 365 and Azure. The markets it competes for are enormous, which gives the company the ability to compound at scale. In the past quarter alone, the company generated over $40 billion in revenue, representing a 17% growth rate. The inherent operating leverage in Microsoft’s business model continues and led to 34% earnings growth this past quarter. Despite the broad rotation we saw in the first quarter and Microsoft’s robust performance in 2020, we think its business fundamentals continue to exhibit strength, and the stock continues to reflect the fundamentals.”
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Disclosure. None. 10 Remote Work Stocks to Buy Now is originally published on Insider Monkey.
