When cloud and AI software stocks like Atlassian and Twilio move sharply on earnings, it can reset expectations across the whole sector in a single session. That kind of shake up can create opportunities for investors who understand which businesses are riding the same demand trends and which are struggling to keep up. This article unpacks 3 stocks exposed to the latest AI driven news and what their setups might mean for your portfolio.
The stocks covered below are just a starting sample, and the full screen surfaced 31 more AI driven cloud software companies with equally compelling narratives that are not included in this article. If you want to move beyond headlines and identify your own highest conviction ideas, head straight into the AI-Driven Cloud Software Stocks screener.
Agilysys (AGYS)
Agilysys is a hospitality software company that provides cloud based property management, point of sale, inventory, and guest experience tools to hotels, casinos, resorts, and other leisure businesses across multiple regions. The company generates about $330 million in revenue from providing software solutions to the global hospitality industry, largely tied to subscription and services around its integrated platform. Agilysys currently carries a market value of roughly $3 billion, which puts it in the mid cap software bracket.
Agilysys sits in the center of the current AI and cloud rally, with its hospitality experience cloud and AI features aimed at helping hotels and resorts run more efficiently and increase guest spending. Recent quarters featured record revenue, higher guidance and expanding margins as subscription revenue becomes a larger share of the mix. Analysts and management both highlight this shift as a key part of the story. On the other hand, the stock already trades on a rich P/E multiple and the business is closely tied to the health of global travel and leisure. Recent insider selling and reliance on external funding also introduce additional considerations. For investors seeking exposure to AI powered vertical SaaS, this is a company that may merit closer study.
Agilysys appears to be a hospitality software story in which a rich P/E and enthusiasm around AI may be obscuring factors that investors have not yet fully pieced together. Start with the 4 key rewards and 1 important warning sign
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Agilysys and the two other stocks in this article all came from the same set of screener filters, and you can apply the same process to your own ideas. Use our flexible Screener to combine metrics like valuation, balance sheet strength and risks, or tap into curated themes through our Investing Ideas.
Pagaya Technologies (PGY)
Pagaya Technologies runs an AI driven credit and data network that helps banks, auto lenders, fintechs and real estate partners approve more customers and fund loans they would otherwise decline. The business generates about US$1.39b in revenue from software and programming services that sit on top of its underwriting and financing platform. With a market value of roughly US$1.78b, Pagaya sits firmly in small to mid cap territory for cloud based financial software.
Pagaya Technologies sits in the crosshairs of the current enthusiasm around AI driven cloud platforms, with its underwriting engine and ABS funding model associated with the same investor appetite that recently pushed Atlassian and Twilio higher following AI related updates. The company combines AI underwriting and auto lending volumes with a valuation that is described as inexpensive on some cash flow estimates, which is why some investors focus on the gap between the current price and various fair value models. On the flipside, Pagaya is not a bank and relies entirely on higher risk external funding, has reported large one off losses in the past and has seen meaningful insider selling, all of which keep risk perceptions elevated. For investors evaluating high growth AI financial software stocks that may be sensitive to shifts in sentiment toward profitable AI platforms, this is a story that can warrant a closer read of the fine print.
Pagaya Technologies sits at the intersection of AI hype and funding risk, yet many investors still treat it like a simple lending story. The real twist is buried in the 4 key rewards and 2 important warning signs
Viant Technology (DSP)
Viant Technology runs a cloud based demand side platform that helps advertisers and agencies buy digital ads across connected TV, streaming audio, digital out of home, mobile and desktop. It uses products like ViantAI, Household ID and IRIS_ID to plan, target and measure campaigns. The company generates about $362 million in revenue from internet information provider services, essentially fees tied to its advertising software and data tools, and is entirely focused on the United States market. Viant Technology currently has a market value of roughly $807 million, which keeps it firmly in small cap software territory.
Viant Technology sits in the slipstream of the rally in Atlassian and Twilio because it already runs an AI heavy, cloud based ad platform where 85% of spend flows through AI bidding and where tools like Household ID and IRIS_ID are built for a cookieless, stricter privacy environment. Analysts currently report a consensus price target above the recent share price and some valuation models flag the shares as attractive relative to certain estimates of fair value. The stock also reflects factors such as a recent loss, insider selling and reliance on external funding. For investors who focus on AI driven software platforms that balance revenue growth and margin discipline, Viant Technology may warrant closer attention.
Viant Technology already runs an AI heavy ad platform, with most spend routed through automated bidding, yet many investors still treat it like a plain small cap. Get the full context in the analysis report for Viant Technology
Curious About What You Might Be Missing
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- Get ahead of possible AI tailwinds by reviewing a focused 55 AI infrastructure stocks built around companies supplying the hardware and networks behind the current AI build out.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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