We recently published a list of 8 Cloud Computing Stocks Under $10. In this article, we are going to look at where Upland Software, Inc. (NASDAQ:UPLD) is trading below $10 against other cloud computing stocks.
According to the Nasscom Community, the cloud computing market will grow to almost $1.2 trillion by 2024. This market has been aided by high demand for scalable, efficient and cost-effective digital solutions. Some of the critical growth drivers include the increase in remote work, the acceleration of digital transformation initiatives, and the robust adoption of IoT devices.
In recent years, cloud computing has merged with Al and business operations have been redefined across industries. According to industry experts, cloud strategies are changing as organizations continue to adopt more services and Al is expected to be one of the biggest drivers. John Samuel, global CIO and EVP at a global IT and outsourcing provider, believes cloud providers have invested significantly in GenAl technologies and are working with chip makers to improve performance and scalability.
According to Samuel, these alliances should enable cloud platforms to power a growing ecosystem of downstream SaaS providers that are building solutions to make the adoption of Al-based solutions easier. Therefore, GenAl remains a key enabler for the adoption of advanced Al capabilities across industries, with the cloud serving as the backbone.
According to Alex Turgeon, president of Valere, Al is expected to drive ~35% of the cloud computing market growth over the next two years. By 2025, Al and cloud computing are expected to form an inseparable partnership. Alex Turgeon believes that enterprise investments in Al-compatible cloud infrastructure should improve scalability, performance and accessibility. According to Deloitte, 70% of companies that adopt Al will adopt it via cloud-based infrastructure.
According to the Nasscom Community, future developments in cloud computing are expected to be supported by multi-cloud strategies. This implies the use of more than one cloud service provider between the company and the cloud in total. By 2025, different cloud networks will be able to communicate, which will result in greater interoperability between different cloud platforms. Enterprises are expected to focus on green cloud initiatives next year. Therefore, the sustainability of cloud solutions related to infrastructure is expected to become a major trend by 2025.
Reputable cloud service providers continue to focus on reducing their global emissions while leveraging green data centers that utilize renewable energy such as wind and solar installations. While some leading technology companies are using renewable energy sources in their data centers, others have committed to achieving carbon negativity by 2030. Nasscom Community added that companies will look for cloud service providers that have solid sustainable solutions, such as carbon neutrality. in Computing Strategies for Corporate Responsibility Programs.
A data extraction engineer putting together a complex integration and configuration.
To list the eight cloud computing stocks under $10, we used a screener and online rankings to extract the list of companies in the cloud computing industry. After getting an initial list of 20-25 stocks, we filtered out the stocks that were trading below $10. Finally, stocks were ranked in ascending order of their hedge fund sentiment as of the third quarter of 2024.
At Insider Monkey, we’re obsessed with the stocks hedge funds are piling into. The reason is simple: our research shows that we can outperform the market by imitating the best stock picks from the best hedge funds. Our quarterly newsletter strategy selects 14 small- and large-cap stocks each quarter and has returned 275% since May 2014, beating the benchmark by 150 percentage points (see more details here).
Share price on November 26: $3.87
Number of hedge fund holders: 10
Upland Software, Inc. (NASDAQ:UPLD) provides cloud-based software applications that help customers drive digital transformation. The company derives its subscription revenue from fees customers pay for using its cloud-based applications. In the third quarter of 2024, Upland Software, Inc.’s subscription and support revenues were (NASDAQ:UPLD) 96% of total revenues. The company welcomed 122 new customers this quarter, including 18 new major customers. It expanded relationships with 312 existing customers, including 27 major expansions. These new and expanded relationships were found throughout the portfolio.
For the fourth quarter of 2024, Upland Software, Inc. expects (NASDAQ:UPLD) adjusted EBITDA between $13.4 million and $16.4 million, for an adjusted EBITDA margin of 22% at the midpoint. This Adjusted EBITDA guidance at the midpoint reflects an increase of 6% year over year. Annual costs will continue to decrease as Upland Software, Inc. achieves its goals. (NASDAQ:UPLD) increase EBITDA. Additionally, investments in customer success should continue to lead to higher renewal rates and higher product usage.
The company announced the availability of Upland BA Insight for Microsoft Azure AI Search on the Microsoft Azure Marketplace. Upland BA Insight’s AI-powered content search provides intelligent search capabilities for the daily search for relevant results. This aligns with a broader effort to increase the relevance of Upland Software, Inc.’s product suite. (NASDAQ:UPLD) in modern business environments. The company’s acquisition strategy remains key to its growth as it targets companies with established cloud-native products and a significant customer base. The acquisition of Qvidian Corporation and RO Innovation by Upland Software, Inc. (NASDAQ:UPLD) is strengthening its sales productivity portfolio.
While Qvidian supports RFP response automation, RO Innovation emphasizes customer reference management. The twelve-month average price target for Upland Software, Inc. stock. (NASDAQ:UPLD) is at $5.00, according to Wall Street.
In short, UPLD is in 6th place on our list of cloud computing stocks under $10. While we recognize UPLD’s potential as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and within a shorter time frame. If you’re looking for a deeply undervalued AI stock that’s more promising than UPLD, but trades at less than five times earnings, check out our report on the cheapest AI stocks.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now AndThe 30 most important AI stocks according to BlackRock.
Disclosure: None. This article was originally published on Insider monkey.
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