Top 3 Cloud Companies Showing Strong Growth Potential
Cloud computing is at the core of today’s digital economy, offering unmatched scalability, flexibility, and cost-efficiency. Companies that provide cloud services are seeing significant growth thanks to widespread adoption across various industries.
Considering the bright future of this industry, it might be wise to look into investing in solid cloud stocks like Oracle Corporation (ORCL), Commvault Systems, Inc. (CVLT), and Docebo Inc. (DCBO) for long-term growth potential.
The cloud computing market is expected to reach $2.29 trillion by 2032, growing at a rate of 16.5%. This growth is being driven by the increase in digital transformation efforts and intense competition among large cloud service providers.
Over 90% of companies globally are already using cloud services, and this number is only expected to rise. Industries like healthcare, education, and retail are rapidly moving towards digital transformation, with cloud adoption playing a significant role in this shift. Studies suggest that companies offering cloud services could create around 472,000 jobs in the U.S. and abroad over the next five years.
As technology like AI and edge computing continues to merge with cloud platforms, the industry is on the path to redefining the digital landscape. This evolution highlights the importance of cloud providers in driving innovation, making them an attractive choice for investors looking for long-term growth opportunities.
Let’s take a closer look at some specific stocks in the Software – Application industry, starting with our third pick:
**Oracle Corporation (ORCL)**
ORCL offers a wide range of products and services for global enterprise IT environments. From cloud software applications and solutions to databases, middleware, and consulting services, ORCL covers a broad spectrum of IT needs.
In the fiscal first quarter ending on August 31, 2024, ORCL reported a 6.9% increase in revenue year-over-year, reaching $13.31 billion. The company’s non-GAAP income from operations grew by 12.9% compared to the previous year, with a non-GAAP operating margin of 43%, up 200 bps year-over-year. Additionally, ORCL’s non-GAAP net income saw an 18% increase year-over-year.
Analysts anticipate that ORCL’s revenue for the second quarter ending in November 2024 will increase by around 9.1% year-over-year to $14.12 billion, with an expected EPS growth of 10.6% from the prior-year quarter. ORCL has surpassed EPS estimates in three of the past four quarters, indicating a positive trend.
ORCL shares have seen impressive growth, with a 73.3% increase year-to-date and a 64% rise over the past nine months, closing at $182.70 in the last trading session. The POWR Ratings reflect a positive outlook for ORCL, with an overall rating of B, translating to a Buy in their proprietary rating system.
Stay tuned for the next segment where we’ll delve into our second pick, Commvault Systems, Inc. (CVLT), and explore its growth opportunities in the cloud computing space.
