In this article, we will look at 8 undervalued software stocks to buy now.
The software industry has remained one of the biggest beneficiaries of digital transformation, AI adoption, and technological innovation. However, many software stocks have experienced volatility amid evolving market sentiment and growth expectations. The recent market shift has created opportunities to identify companies whose share prices don’t fully reflect the underlying strength.
On July 10, Reuters published an article titled “U.S. equity funds draw biggest weekly inflow in three weeks on tech earnings hopes,” outlining that the U.S. equity funds reported their largest weekly inflow in three weeks through July 8. This was backed by stronger technology sector earnings expectations and softened worries about additional Federal Reserve rate hikes.
The article further added that solid technology sector earnings expectations ahead of the Q2 reporting season drove heightened demand. Having said that, analysts project an average YoY earnings growth of 40.8% for U.S. large- and mid-cap technology companies, according to LSEG data.
The LSEG data further showed that robust demand for AI solutions has led analysts to lift their average 12-month earnings forecasts for the technology group by 4.2% over the past month, as noted by the author.
With this backdrop in mind, let’s look at the 8 undervalued software stocks to buy now.
Photo by Danial Igdery on Unsplash
Our Methodology
For this article, we considered software stocks with market capitalizations exceeding $2 billion. After this initial screening, we shortlisted stocks with a forward P/E below 22, a range that indicates a reasonable discount to the industry, and an upside potential of at least 20%. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are ranked by upside potential in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
8. Fiserv, Inc. (NASDAQ:FISV)
Upside Potential as of July 10, 2026: 22.89%
On July 10, Bryan Keane from Citi cut the price target on Fiserv, Inc. (NASDAQ:FISV) to $57 from $60 and reiterated a Neutral rating. The analyst notes that although leadership changes introduce additional uncertainty to the turnaround, the departures are “not really surprising.” The firm believes strategic direction and operational focus presented at the investor day “should continue to serve as meaningful guideposts.”
Recently, several other analysts revised their outlook on Fiserv, Inc. (NASDAQ:FISV). On July 9, Goldman Sachs analyst Will Nance trimmed the price target on the company to $60 from $70 and reaffirmed a Neutral rating. In a research note, the analyst said that the Payments group is comparatively in a stronger position as it enters Q2 earnings, despite poor YTD performance.
Similarly, Wells Fargo lowered the price target on Fiserv, Inc. (NASDAQ:FISV) to $56, down from $62, on the same day. The firm thinks that Q2 projections are achievable, yet it expects limited upside for the shares due to a steep second-half ramp and an unexpected CEO change. With that said, the firm has an Equal Weight rating on the shares.
Fiserv, Inc. (NYSE:FISV) is a Wisconsin-based provider of financial services technology. The company offers various products and services, including payment and mobile banking systems, account processing systems, and financial solutions.
7. Atlassian Corporation (NASDAQ:TEAM)
Upside Potential as of July 10, 2026: 29.42%
On July 8, KeyBanc trimmed the price target on Atlassian Corporation (NASDAQ:TEAM) to $115 from $130 and reiterated an Overweight rating. The firm has updated its model to better reflect the views of investors, management, and partners.
The firm lowered its Cloud estimates for FY27, particularly due to softer migration and organic growth assumptions, despite higher data center projections. Overall, KeyBanc anticipates conservative FY27 guidance from management, while viewing this as a clearing event that enhances visibility of near-term trends.
Back on June 25, BMO Capital cut the price target on Atlassian Corporation (NASDAQ:TEAM) to $95 from $105 after readjusting its model. The firm has lowered its data center revenue forecasts for FY27 to negative 22% growth, down from negative 12%. Additionally, the firm reduced its operating margin and free cash flow estimate.
In its analysis, the firm also highlighted the company’s strong product offering and solid distribution and pricing strategies, adding that the stock’s current valuation offers an appealing risk/reward profile. The firm has an Outperform rating. Indeed, Atlassian Corporation (NASDAQ:TEAM) is one of the undervalued software stocks to buy now.
Atlassian Corporation (NASDAQ:TEAM) is an Australian provider of software that facilitates team collaboration. Founded in 2002, the company offers a project management platform, a connected workspace, an asynchronous video communication tool, an intuitive service management solution, and other AI-related tools.
6. SS&C Technologies Holdings, Inc. (NASDAQ:SSNC)
Upside Potential as of July 10, 2026: 39.60%
On July 7, SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) announced plans to allow digital cash settlement for tokenized investment transactions. This would utilize regulated forms of digital cash, particularly stablecoins and tokenized commercial bank deposits.
The announcement comes after the successful launch of the company’s live tokenized fund issuance and distribution capabilities earlier in 2026. This follows last year’s acquisition of Calastone. While bridging traditional and digital investment markets, SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) enables asset managers to deliver tokenized versions of traditional investment funds through existing infrastructure and connectivity.
With surging interest in tokenized investment products, the sentiment is shifting from tokenization alone to the infrastructure required for digital transactions. What’s interesting is that SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) is advancing its innovation strategy to power the next stage of the digital investment lifecycle. Given its 39.60% upside potential and 9.80 Forward P/E, SSNC remains one of the undervalued software stocks to buy now.
SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) is a Connecticut-based provider of software products and software-enabled services. Incorporated in 1986, the company serves the financial services and healthcare industries.
5. Q2 Holdings, Inc. (NYSE:QTWO)
Upside Potential as of July 10, 2026: 42.77%
On June 22, Ella Smith from JPMorgan trimmed the price target on Q2 Holdings, Inc. (NYSE:QTWO) to $60, down from $80. The firm has updated its financial models and price targets for the banking technology and digital banking space to December 2027 from December 2026.
With a constructive stance on the group, JPMorgan said “AI-defensibility concerns appear overstated relative to the entrenched workflow, data, and compliance moats these vendors have built.”
The firm appeared extremely optimistic on Q2 Holdings, Inc. (NYSE:QTWO) and Alkami, as they operate in a duopolistic digital banking market with solid retention, long contract durations, and opportunities for free cash flow expansion. The firm has an Overweight rating on QTWO.
Overall, Q2 Holdings, Inc. (NYSE:QTWO) has a Buy rating from the majority of the analysts covering the stock, with the remaining 14% having a neutral view. The company has a forward P/E of 21.01 and upside potential of approximately 43%, making it one of the undervalued software stocks to buy now.
Q2 Holdings, Inc. (NYSE:QTWO) is a Texas-based provider of digital solutions to financial institutions, FinTechs, and alternative finance companies. Founded in 2004, the company offers a digital banking platform, risk and fraud solutions, and a real-time core processing platform, among others.
4. CCC Intelligent Solutions Holdings Inc. (NASDAQ:CCC)
Upside Potential as of July 10, 2026: 43.58%
On July 10, Reuters’ Milana Vinn reported that CCC Intelligent Solutions Holdings Inc. (NASDAQ:CCC) is exploring a potential sale of the company. The author cited three individuals familiar with the discussion. In addition to potential suitors, the company has engaged Morgan Stanley to advise on the sale process.
Earlier on July 2, Shlomo Rosenbaum, an analyst at Stifel, said that the CEO of CCC Intelligent Solutions Holdings Inc. (NASDAQ:CCC) should consider taking the company private. The analyst believes that the market is currently underappreciating the company’s “moat, network effect, AI tailwind” at the “low valuation.”
Stifel said that the financials support deals, while highlighting that the business does not require a turnaround. The firm argues that the share pullback, due to AI disruption risk, has resulted in an opportunity for the CEO to take the company private again. With that said, the firm has a Buy rating and a price target of $9 on CCC Intelligent Solutions Holdings Inc. (NASDAQ:CCC).
CCC Intelligent Solutions Holdings Inc. (NASDAQ:CCC) is an Illinois-based SaaS company specializing in innovative cloud and hyperscale technologies and applications for the property and casualty insurance industry.
3. Amdocs Limited (NASDAQ:DOX)
Upside Potential as of July 10, 2026: 50.26%
On June 29, KeyBanc started coverage on Amdocs Limited (NASDAQ:DOX) with a Sector Weight rating, saying that it is “constructive” on the company’s leadership within the telecom space. The firm has no price target.
According to KeyBanc, Amdocs Limited (NASDAQ:DOX) is in a solid position to drive even more share gains. However, its neutral stance is due to the company’s revenue and earnings growth profile, in contrast to that of its competitors.
The company’s prospects for growth acceleration, powered by AI opportunities, still remain in the early stages, the firm concluded. Thus, with an upside potential of approximately 50%, Amdocs Limited (NASDAQ:DOX) remains one of the undervalued software stocks to invest in.
Back on June 24, Amdocs Limited (NASDAQ:DOX) announced its selection as the telecom operator Three Scandinavia’s strategic partner to strengthen its current business and drive its digital transition across Sweden and Denmark. With a focus on enhancing selected customer engagement and commerce capabilities, the collaboration will improve the use of data and automation.
Amdocs Limited (NASDAQ:DOX) is a Missouri-based company offering software and services to a range of service providers, including communications, entertainment, and media. Founded in 1982, the company specializes in open and modular cloud solutions.
2. Klaviyo, Inc. (NYSE:KVYO)
Upside Potential as of July 10, 2026: 77.41%
On June 24, Callie Valenti from Goldman Sachs assumed coverage of Klaviyo, Inc. (NYSE:KVYO) with a price target of $26, implying approximately 54% upside. In a research note, the analyst highlighted the stock’s 30% decline following Q1 earnings. This was mainly due to the planned CFO departure and factors that added uncertainty around sequential and year-on-year trends, the analyst added.
The firm’s Buy rating is driven by Klaviyo, Inc. (NYSE:KVYO)’s exposure to a range of growth drivers, reinforcing a strong underlying business. This is supported by the company’s revenue growth, which remains at a high 20% pace, Valenti said.
Despite the negative returns, Klaviyo, Inc. (NYSE:KVYO) is a consensus Buy. The stock has 77.41% upside potential at the 1-year median price target of $30. With a forward P/E of 20.66 and quarterly revenue growth (yoy) of 27.90%, KVYO is one of the undervalued software stocks to buy now.
Klaviyo, Inc. (NYSE:KVYO) is a Massachusetts-based cloud-based SaaS platform offering CRM, Klaviyo Data Platform, Advanced KDP, and Marketing Agent, among others. Incorporated in 2012, the company mainly serves entrepreneurs, SMEs, and other enterprises.
1. Strategy Inc. (NASDAQ:MSTR)
Upside Potential as of July 10, 2026: 158.88%
On July 8, Barclays started coverage on Strategy Inc. (NASDAQ:MSTR) with an Overweight rating and a price target of $130. The initiation follows a broad sector reset, after which there is more emphasis on stock selection and identification of strong franchises that are well-positioned for long-term growth, the analyst said.
A day earlier, Mizuho trimmed the price target on Strategy Inc. (NASDAQ:MSTR) to $213 from $265 and maintained an Outperform rating. This comes after the revised Bitcoin holdings to 843,775 following the company’s recent Bitcoin selling activity. The new price target is based on the adjusted Bitcoin market price forecast for end-2027, set at $71,500.
Overall, Strategy Inc (NASDAQ:MSTR) has a Buy rating from 90% of the analysts covering the stock, with the remaining 10% neutral. With a 1-year median price target of $245, the stock has an upside potential of 158.88%. This potential is understandable given the stock’s nearly 78% decline over the past year.
Strategy Inc. (NASDAQ:MSTR) is a Virginia-based bitcoin treasury company. In addition to providing AI-powered enterprise analytics software, the company offers a range of securities that provide investors with economic exposure to bitcoin.
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