We recently published a list of 10 Best Software Infrastructure Stocks to Buy According to Analysts. In this article, we are going to take a look at where Informatica Inc. (NYSE:INFA) stands against other best software infrastructure stocks to buy according to analysts.
Companies today allocate significant resources to various aspects of software infrastructure, including servers and data centers for secure data storage and processing, cloud migration and management for scalable environments, network monitoring and management to ensure stability and security, and communication software. Additionally, software delivery and deployment solutions streamline application deployment, while bug tracking and error handling systems manage and resolve software issues. The increasing demand for cloud computing, digital transformation, and the integration of advanced technologies like artificial intelligence and machine learning are expected to drive substantial growth in the global software infrastructure sector. As organizations continue to prioritize agility, scalability, and efficiency, the software infrastructure market is projected to expand rapidly.
According to a January 2025 report by The Business Research Company, the infrastructure software market size is projected to grow from $210 billion in 2024 to $220 billion in 2025, with a growth rate of 5.1%. The market has experienced strong growth in recent years due to spending on legacy system modernization, the increase in remote work, cybersecurity concerns, automation, and application performance optimization. The research firm anticipates continued strong growth, with the market expected to reach around $283 billion by 2029, at a compounded annual growth rate (CAGR) of 6.5%.
Major players in the sector will continue to play a significant role by investing heavily in enhancing their offerings to capture market share. These companies are focusing on developing innovative solutions that leverage AI and automation to improve operational efficiency and enhance the user experience.
Cantor Fitzgerald analyst Thomas Blakey recently initiated coverage of 18 names in infrastructure and artificial intelligence software. In a research note to investors, he highlighted the growing importance of infrastructure software due to the ongoing secular expansion of AI and generative AI. These developments drive the demand for unified, secure, and highly integrated data systems, observable infrastructure, real-time computing and networking capabilities, and enhanced workflows and collaboration. Additionally, the analyst expects cloud infrastructure platforms to be pivotal in consolidating these functions.
Our Methodology
To identify the 10 best software infrastructure stocks, we conducted extensive research to compile a list of fundamentally strong U.S. listed software infrastructure companies with a market capitalization of $2 billion and above. We then ranked the stocks in ascending order of their potential upside, with the stock having highest upside ranked at the top.
Note: All pricing data is as of market close on February 7.
At Insider Monkey we are obsessed with 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. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A business executive in a modern office looking over reports detailing artificial intelligence.
Informatica Inc. (NYSE:INFA)
Upside Potential: 36%
Number of Hedge Funds: 22
Informatica Inc. (NYSE:INFA) specializes in data integration and management solutions, focusing on cloud data management, data governance, data catalog, and data quality. The company’s Intelligent Data Management Cloud (IDMC), powered by its AI engine CLAIRE, delivers top-tier solutions that enable enterprises to connect virtually all types of data, govern and protect critical and sensitive information, and prepare data for AI and other strategic data-driven initiatives.
On December 12, 2024, Truist Securities initiated coverage of Informatica Inc. (NYSE:INFA) with a Buy rating and a $34 price target. The analyst identified Informatica as a key player in enterprise data management, addressing data silos that have developed over time and persist in cloud environments. With many enterprises seeking solutions compatible with their existing data stacks rather than fully re-platforming, Informatica Inc. (NYSE:INFA) is well-positioned to benefit. The analyst believes this urgency among its customers could drive faster cloud adoption and overall growth than currently anticipated by the market. This positions Informatica Inc. (NYSE:INFA) for significant opportunities and strong future performance.
Overall, INFA ranks 5th on our list of best software infrastructure stocks to buy according to analysts. While we acknowledge the potential of INFA to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than INFA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
