7 Best SaaS Stocks to Buy Now

Best SaaS Stocks To Buy Now: Trends shape the world, and they influence the financial markets. Sometimes, specific industries just seem to be on fire. The spark eventually burns out, but the savvy (or lucky) investor has made the right bets or differentiated his wagers so that he walks away with a tidy profit.

Sometimes though, the trend doesn’t burn out. It becomes the new standard and shapes everything to come. Software as a Service (SaaS) is a good example.

Understanding Software as a Service

SaaS has a myriad of different uses in a world that is increasingly online and cloud-based. For those who may be unclear as to what, exactly, Software as a Service is, here is a simple definition: SaaS is a cloud-based application. That’s it.

You don’t have to download anything or make sure that your computer has specific capabilities. You just need to be able to use a browser, and you are in. This means that you don’t need to buy as much stuff, be it hardware or software.

The other side to Software as a Service is that it is often subscription-based. You pay a monthly fee to use the SaaS offering. This amount is usually way less than the software itself would cost.

Take Adobe’s Photoshop, for example. The software used to cost hundreds of dollars. Today, users can get access to Photoshop as well as Lightroom and receive 20GB of storage for the comparatively low cost of $9.99 per month or get access to every app Adobe makes for $52.99 per month.

Granted, you can only use Photoshop when you have an Internet connection, but you get access to the software without making a substantial upfront investment, and you can cancel at any time.

SaaS in Practice

In this way, SaaS is a very diplomatic way to sell software. Most people and businesses can afford the subscription – $9.99 is less than the cost of lunch for many people – and because data is stored in the cloud, users don’t even need a powerful computer to do access the SaaS.

The companies that sell the SaaS love it because they get predictable income from all of those subscriptions as opposed to waiting to see how many people will buy a software.

The only real downside is that an Internet connection is required, but Internet is easy to come by in most places, so it may not be much of an issue at all.

SaaS has grown in popularity as subscription media, and easy Internet access became the norm. Today, many companies are working in the space – and some are worth a closer look. We don’t guarantee that investing in these companies will turn a profit, but we are excited about what the future holds for them.

Slack Is SaaSy

Slack (WORK) is a tool that promotes teamwork and collaboration. Think of it like social media meets productivity.

Slack organizes everything into channels, so any conversations, files, or questions stay aligned under that channel. The idea is to eliminate crowded inboxes. Plus, the whole thing is searchable, so you can find a conversation or a file very easily.

Slack also lets you prioritize some channels over others, so you can avoid notifications of some topics while getting alerts on others.

Slack can stand alone, but it can also integrate into a company’s existing tech, acting as a central hub and syncing information between such heavy hitters as Google Drive, OneDrive, Salesforce, and Zendesk.

Some big-name clients include E*TRADE, Fox, IBM, Intuit, Jet, New York Times, Oracle, and Target.

DocuSign Is Made For The Virtual World

DocuSign (DOCU) is a SaaS that is focused on documents (hence the name), but it is more than a service that lets you sign an eSignature.

DocuSign is involved in the entire contract lifecycle. The service can help you automate agreements, establish workflows, facilitate negotiation, and streamline approvals.

DocuSign also offers Agreement Analytics that leverage AI to analyze your legal documents. No more printing contracts, these digital copies are faster to produce and cheaper.

DocuSign’s top clients include T-Mobile, Unilever, Salesforce, Apple, Uber, Aetna, AstraZeneca, Samsung, Facebook, Citgo, and Visa.

Box = Cloud For Business

Box (BOX) is a cloud content management company. It allows people to store and organize documents in Box Drive. From there, teams can collaborate on that content. Users can be part of your organization, or they can come from outside your network.

Box also offers a feature called Box Notes that lets users take notes on meetings and collaborate.

There is also an element to Box that automates specific processes, like onboarding, so the right person gets the right documents at the right time, and it doesn’t require a person to manage the process. It is called Box Relay, and it is also beneficial in contract review.

Box integrates with a variety of apps, including Adobe, G Suite, Office 365, and Slack. Some of the company’s biggest clients are Allstate, AstraZeneca, GE, Intuit, and Morgan Stanley.

Zendesk: Virtual Helpdesk For Everyone

Zendesk (ZEN) is a SaaS that allows companies to offer a virtual helpdesk. The CRM makes it easy for customers and employees alike to open tickets and get the support they need.

This could be on a small scale – allowing a small retailer to get an email when there is an issue with a customer order – or it could go enormous. Zendesk can also be used in call centers.

Together, these form Zendesk’s Support Suite. The SaaS provides solutions for self-service databases, live chat, and forums. Zendesk also offers a Sales Suite with voice, SMS, and live chat solutions as well as bulk email.

Top Zendesk customers include OpenTable, Shopify, Slack, Tesco, Venmo, and Uber.

ServiceNow Has Mushroomed

ServiceNow (NOW) is the company behind the Now Platform. It lets businesses develop workflows, digitize them, then automate them.

Now Flows can span departments as well as apps. The company also has offerings relating to application development, virtual agents, and configuration management database (CMDB).

These elements are reinforced by predictive intelligence that helps automate routine tasks while performance analytics help their customers understand the exact trends and implications of the insights learned from the Now Platform.

Furthermore, the Now Platform also makes it easier to build enterprise workflow apps. Here is a sampling of the company’s customers: Beachbody, Experian, GE Capital, General Mills, Magellan Health, Malaysia Airlines, Overstock, RBS, TimeWarner, and Wayfair.

Atlassian Is a Team SaaS Company

Atlassian (TEAM) is the company behind popular tools Trello and Jira, amongst others. Jira Core is a project management tool. Projects are broken down into workflows complete with review periods.

Users can post project comments, documents, or statuses, so team members can easily see project statuses.

Atlassian also offers Jira Software for software development, Jira Alignfor strategic initiatives, and Jira Service Desk for customer service and employee helpdesk needs.

Atlassian also offers SaaS outside of Jira. The visual project management tool Trello is one of these product offerings, but there are others.

Another Atlassian product is Confluence. It is a teamwork and collaboration tool. Page trees are visible, and the Pages themselves can be organized into Spaces as the user sees fit. Spaces can be individual, involve the whole company, or fall somewhere in between.

Companies that use Atlassian products include AirBnB, BlackRock, Dominos, Gilt,  Sotheby’s, Spotify, The Telegraph, and Twitter.

Xero Is SaaS For Accounting

Xero is an accounting SaaS. Users can use the services as software to run their businesses, from invoicing and inventory management to payroll.

Xero also focuses on money management and business performance. It prompts users to categorize bank transactions daily, automatically generates robust cash flow profitability charts, and sends out invoice reminders.

Xero doesn’t have as many big-name clients as some of the other companies on our list, but it shouldn’t. That’s not its target clientele.

This company serves smaller companies, including startups and Amazon sellers. Here is a sampling of Xero’s client roster: CV Ledger, Horsetooth Hot Sauce, KARVD Walls, Olive & Poppy, Orenda Tribe, Studio BANAA Architects, Sutro Li Bookkeeping, and an H&R Block franchisee with multiple locations.

Investing in SaaS Stocks

Check out these SaaS stocks and see what you think. Whether you believe in Software as a Service or not, the technology is prevalent. The right company could become a good investment for your portfolio.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.