In this article, we will list the 5 Best Software Infrastructure Stocks to Buy Now. Please visit 9 Best Software Infrastructure Stocks to Buy Now if you would like to see the extended list and the methodology behind it.
5. Toast, Inc. (NYSE:TOST)
Number of Hedge Fund Holders: 68
On April 22, TheFly reported that BMO Capital started coverage on Toast, Inc. (NYSE:TOST) with an Outperform rating and a price target of $35. In a research note, the analyst says the recent market pullback calls for an emphasis on category leaders with solid moats that are resilient to AI disruption and intensifying competition.
Given this landscape, Toast, Inc. (NYSE:TOST) differentiates itself through unique growth catalysts that underpin its long-term growth momentum, the firm added. As stated by it:
“Under this framework, we believe TOST stands out, supported by idiosyncratic growth drivers that have yet to fully materialize.”
The company’s financial standing reinforces the firm’s view. With an impressive quarterly earnings growth (YoY) of 215.60% and an ROE (ttm) of 18.64%, Toast, Inc. (NYSE:TOST) is considered one of the best software infrastructure stocks to buy now. Out of the 32 analysts covering the stock, 66% have a bullish take, and the remaining 34% are neutral.
Toast, Inc. (NYSE:TOST) is a Massachusetts-based operator of a cloud-based digital technology platform. Incorporated in 2011, the company offers a range of products and services, including SaaS for restaurant operations, conversational AI, online ordering, and vendor management.
4. Core Scientific, Inc. (NASDAQ:CORZ)
Number of Hedge Fund Holders: 76
On April 28, TheFly reported that Keefe Bruyette lifted the price target on Core Scientific, Inc. (NASDAQ:CORZ) to $28, up from $25, and reiterated an Outperform rating. Slightly above the one-year median price target of $27, the firm’s target reflects an upside potential of approximately 38% from the current level.
A day earlier, Core Scientific, Inc. (NASDAQ:CORZ) announced the expansion of its Pecos, Texas campus to nearly 1.5 gigawatts of gross power capacity, which is roughly 1.0 GW of leasable power. This is being done to transform its Pecos facility into a data center facility for AI infrastructure. With initial capacity planned for early next year, the interior foundational footings for the first data hall have already been finished.
As stated by CEO Adam Sullivan,
“By expanding in a market where we already control power, infrastructure, and operations, we can execute with speed to meet market demand.”
Overall, Core Scientific, Inc. (NASDAQ:CORZ) has consistently outperformed the benchmark. If we consider the YTD comparative return, the company delivered 39.77% versus the S&P 500’s 5.62%. This alone speaks volumes about the company’s operational momentum, making it one of the best software infrastructure stocks to invest in.
Core Scientific, Inc. (NASDAQ:CORZ) is a Delaware-based provider of infrastructure for high-density colocation services and digital asset mining. Founded in 2017, the company operates through Colocation, Digital Asset Self-Mining, and Digital Asset Hosted Mining segments.
3. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 89
On May 2, Stephen Bersey, an analyst at HSBC, downgraded Palantir Technologies Inc. (NASDAQ:PLTR) to Hold from Buy and trimmed the price target to $151 from $205. As said by the analyst, the company was the first one to develop a forward-deployed engineer model by embedding engineers within customer organizations. However, this has led peers like OpenAI to adopt similar approaches.
Bersey believes the rise of agentic frameworks and model-context protocol servers has begun to weaken the company’s long-standing competitive moat. With Anthropic’s boosted revenue, HSBC thinks some of it may be coming at the expense of Palantir Technologies Inc. (NASDAQ:PLTR).
Recently, several other analysts have presented their narratives. RBC Capital views the company’s valuation as unattractive and its risk/reward profile as skewed downward. The firm maintained an Underperform rating and a price target of $90 on Palantir Technologies Inc. (NASDAQ:PLTR) on April 29.
On the other hand, Wedbush is positive about the company’s Artificial Intelligence Platform, noting that its technology is gaining attention through word of mouth among its current customer base. The firm maintained an Outperform rating and a price target of $230 on the company on April 29. With a Buy rating from more than half of the analysts covering the stock, the company remains one of the best software infrastructure stocks to buy now.
Palantir Technologies Inc. (NASDAQ:PLTR), incorporated in 2003, is a Florida-based software platform provider for the intelligence community, supporting counterterrorism investigations and operations.
2. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 111
On April 28, Wedbush reaffirmed an Outperform rating on Oracle Corporation (NYSE:ORCL) with a price target of $225. While disagreeing with the idea that growth is slowing, the firm said that OpenAI is experiencing very strong demand across both consumer and enterprise ends.
Wedbush further stated that it will continue to acquire AI-powered technology stocks, particularly Oracle Corporation (NYSE:ORCL), viewing the recent worries about OpenAI as exaggerated. The company has adequate capital to meet its compute capacity needs for at least the next three years, the firm asserted, adding that this supports the company’s backlog fulfillment in the near term.
With a bullish stance from the majority of analysts covering the stock and strong fundamentals, Oracle Corporation (NYSE:ORCL) is among the best software infrastructure stocks to invest in. The company has an impressive ROE (ttm) of 57.57%, a quarterly revenue growth (YoY) of 21.70%, and a one-year return of nearly 15%.
Oracle Corporation (NYSE:ORCL) is a Texas-based company that provides solutions for enterprise information technology environments. Incorporated in 1977, the company offers Oracle Cloud SaaS, Oracle Health applications, Oracle Cloud and on-premises licenses, and Oracle license support services.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 312
On May 1, TheFly reported that Patrick Colville from Scotiabank trimmed the price target on Microsoft Corporation (NASDAQ:MSFT) from $600 to $550 and reiterated an Outperform rating. While noting the strong third-quarter results, the analyst said that “full speed ahead” Q4 guidance and “all systems go” for FY27 targets stood out the most.
According to Colville, investors appear concerned about Azure’s growth momentum, Copilot adoption, OpenAI’s competitive standing, and potential increases in capex. The recent earnings helped lift these worries, driven by anticipated Azure re-acceleration through the year, greater M365 Copilot seat adoption, access to OpenAI technology at zero incremental cost, and updated capex targets, the analyst concluded.
On the other hand, BMO Capital lifted the price target on Microsoft Corporation (NASDAQ:MSFT) to $515 from $505 and reaffirmed an Outperform rating on April 30. The firm believes that the company is a strong defensive stock in a troubled software landscape. Thus, it remains one of the best software infrastructure stocks to buy now.
As stated by the analyst,
“MSFT reported a solid set of results, with Azure growth that was 1 point above consensus, and a June quarter Azure revenue guide of 39-40% y/y that was ahead of expectations.”
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based company operating through Productivity and Business Processes, Intelligent Cloud, and Personal Computing segments. Founded in 1975, the company provides software, services, devices, and solutions worldwide.
While we acknowledge the potential of MSFT to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MSFT and that has 100x upside potential, check out our report about the cheapest AI stock.
READ NEXT: Starter Stock Portfolio: 14 Safe Stocks to Buy Now and 40 Most Popular Stocks Among Hedge Funds Heading Into 2026.
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