SPDR S&P Software & Services ETF (ARCA: XSW)

Dernières nouvelles pour SPDR S&P Software & Services ETF (ARCA:XSW)

SPDR S&P Software & Services ETF

Technology

Communication Services

Financial Services

Other

In seeking to track the performance of the S&P Software & Services Select Industry Index (the index), the fund employs a sampling strategy. It generally invests substantially all, but at least 80%, of its total assets in the securities comprising the index. The index represents the software and services segment of the S&P Total Market Index (S&P TMI).

Aurora Innovation

Samsara Inc, Class A

Zeta Global Holdings Corp.

Appian Corp

Commvault Systems Inc

Varonis Systems Inc

Alkami Technology Inc Ser F Pc Pp

Sentinelone Inc -Class A

Braze Inc

Ringcentral Inc, Class A

D-Wave Quantum, Inc.

Guidewire Software Inc

Gitlab Inc

Roblox

Klaviyo Inc

Grid Dynamics Holdings

Palantir Technologies Inc.

Pegasystems, Inc.

Semrush Holdings Inc.

International Business Machines Corp.

Nutanix Inc

Solarwinds Corp

Take-Two Interactive Software, Inc.

A10 Networks Inc

Fortinet Inc.

Quantum Computing Inc

Porch Group Inc

Nextnav Inc

Pagerduty Inc

Microstrategy Inc

Asia Vital Components Co Ltd

Qxo, Inc.

Rubrik, Inc., Class A

Crowdstrike Holdings Inc. Class A

Cadence Design Systems Inc.

Quantum Computing Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QUBT#NASDAQ">QUBT</a>) shares are <a target="_blank" href="https://www.benzinga.com/pressreleases/25/05/n45667442/quantum-computing-inc-set-to-join-russell-2000-and-russell-3000-indexes" rel="noreferrer noopener">trading lower on Thursday</a>.
The firm is gaining attention as it prepares to join two widely followed stock indexes, marking a key step in its ongoing growth trajectory.
On June 30, 2025, the firm will officially become part of the Russell 3000 Index, which tracks the top 3,000 publicly traded U.S. companies by market capitalization, as well as the Russell 2000 Index, which highlights small-cap names.
The annual reconstitution of these indexes is based on market capitalization as of April 30, with updated membership remaining in effect for one year.
Also Read: <a target="_blank" href="https://www.benzinga.com/general/market-summary/25/05/45611941/quantum-computing-stocks-in-focus-pure-play-vs-large-caps-heres-a-look-at-the-valuations" rel="noreferrer noopener">Quantum Computing Stocks In Focus: Pure Play Vs. Large Caps &#8211; Here&#8217;s A Look At The Valuations</a>
Chris Boehmler, CFO of Quantum Computing, emphasized the significance of the inclusion, calling it a &#8220;meaningful milestone.&#8221;
He added, &#8220;This inclusion expands our visibility among a broader pool of institutional investors and index funds and reflects the progress we&#8217;ve made in strengthening our financial foundation while advancing quantum technologies with real-world applications.&#8221;
FTSE Russell, the global index provider behind the indexes, states that approximately $10.6 trillion in assets are benchmarked to the Russell U.S. indexes, underlining the potential exposure boost for Quantum Computing through this development.
The Russell 3000 and 2000 indexes are considered critical benchmarks for passive and active institutional investors.
Their annual rebalancing attracts significant market activity and often leads to increased liquidity and investor interest for newly included companies.
Quantum Computing specializes in delivering quantum-based solutions with practical applications, aiming to differentiate itself in the evolving tech landscape.
According to&nbsp;<a target="_blank" href="https://pro.benzinga.com/?gspk=YWRhbWVja2VydDUzMzY&amp;gsxid=zBMR4PKmcgBw" rel="noreferrer noopener">Benzinga Pro</a>, QUBT stock has gained over 80% in the past month. Investors can gain exposure to the stock via&nbsp;SPDR S&amp;P Software &amp; Services ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XSW#NYSE">XSW</a>).
Price Action: QUBT shares are trading lower by 2.66% to $12.42 at last check Thursday.
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Image via Shutterstock

Equities

News

Markets

Movers

Tech

General

QUBT

What's Going On With Quantum Computing Stock Today?

FiscalNote Holdings Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NOTE#NYSE">NOTE</a>) agreed<a href="https://www.benzinga.com/pressreleases/25/05/b45190351/fiscalnote-signs-definitive-agreement-to-divest-additional-non-core-asset-to-further-streamline-co" target="_blank" rel="noreferrer noopener"> to sell</a> its Australian subsidiary, TimeBase, to Thomson Reuters Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TRI#NASDAQ">TRI</a>) for $6.5 million.
FiscalNote acquired TimeBase in 2021, bringing Australian legislative data services to its portfolio for legal professionals. Operating largely apart from FiscalNote's core customer base, TimeBase contributed just $1.3 million to the company's $120.3 million in 2024 GAAP revenue.
The divestiture is part of FiscalNote's effort to streamline operations, reduce debt, and refocus on its core strengths—particularly the enhanced PolicyNote platform, which will continue serving clients in the Australian market. Proceeds from the sale will be used to pay down the company's senior-term loan.
Also Read: <a href="https://www.benzinga.com/news/earnings/25/05/45143938/thomson-reuters-maintains-strong-fy25-outlook-highlights-innovation-ai-as-key-growth-drivers" target="_blank" rel="noreferrer noopener">Thomson Reuters Maintains Strong FY25 Outlook, Highlights Innovation, AI As Key Growth Drivers</a>
Despite the financial impact of the divestiture, FiscalNote reaffirmed its full-year 2025 guidance, projecting revenue of $94 to $100 million (versus the consensus of $122.34 million) and adjusted EBITDA between $10 and $12 million. Management pointed to operational efficiencies and a more concentrated business model as drivers of sustained performance.
"This divestiture is another clear step in sharpening our strategic focus, improving our capital structure, and accelerating our path to positive free cash flow," said Josh Resnik, CEO and President of FiscalNote. 
Thomson Reuters held Cash and cash equivalents of <a href="https://www.benzinga.com/pressreleases/25/05/n45128950/thomson-reuters-reports-first-quarter-2025-results" target="_blank" rel="noreferrer noopener">$1.37 billion</a> as of March 31.
Price Action: NOTE shares are trading higher by 3.26% at 62 cents premarket at the last check Monday.
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</ul>

Asset Sales

NOTE

FiscalNote Sells TimeBase To Thomson Reuters For $6.5M, Reaffirms 2025 Outlook

Quantum Computing Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QUBT#NASDAQ">QUBT</a>) shares were trading lower on Tuesday before <a href="https://www.benzinga.com/movers" target="_blank" rel="noreferrer noopener">seeing a slight uptick.</a>
The company has secured its second purchase order for its LiDAR-based R&amp;D offering from the Department of Aerospace Structures and Materials at <a href="https://www.benzinga.com/pressreleases/25/04/n44583786/quantum-computing-inc-secures-quantum-photonic-vibrometer-order-with-delft-university-of-technolog" target="_blank" rel="noreferrer noopener">Delft University of Technology in the Netherlands.</a>
This purchase order is for a Quantum Photonic Vibrometer. The device is designed for sensing applications in challenging environments over various distances.
Delft University will use the QPV in Non-Destructive Testing and Structural Health Monitoring.
According to Assistant Professor Vahid Yaghoubi, the university was drawn to QPV&#8217;s advanced photon-counting capabilities, high sensitivity, and ability to perform contactless measurements.
Also Read: <a target="_blank" href="https://www.benzinga.com/news/global/25/04/44585626/trump-aides-draft-sweeping-20-tariffs-on-at-least-most-imports-report" rel="noreferrer noopener">Trump Aides Draft Sweeping 20% Tariffs On &#8216;At Least Most&#8217; Imports: Report</a>
The QPV stands out due to its advantages over traditional laser Doppler vibrometers, particularly its single-photon sensitivity and noise suppression capabilities, making it ideal for precise measurements in real-world applications.
Delft University plans to benchmark the QPV against other vibrometers to validate its performance.
William McGann, CEO of Quantum Computing, says the order reflects growing market demand for quantum sensing technologies that offer superior accuracy and sensitivity compared to traditional solutions.
This latest partnership comes shortly after a similar deal with Johns Hopkins University for Quantum Computing&#8217;s Scanning LiDAR, underscoring the increasing recognition of Quantum Computing&#8217;s innovative quantum technologies.
According to&nbsp;<a target="_blank" href="https://pro.benzinga.com/?gspk=YWRhbWVja2VydDUzMzY&amp;gsxid=zBMR4PKmcgBw" rel="noreferrer noopener">Benzinga Pro</a>, QUBT stock has gained over 666% in the past year. Investors can gain exposure to the stock via&nbsp;SPDR S&amp;P Software &amp; Services ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XSW#NYSE">XSW</a>).
Price Action: Quantum Computing shares are trading higher by 0.5% to $8.04 at last check Tuesday.
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</ul>
Image: Shutterstock

Following Microsoft&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) second-quarter fiscal 2025 earnings report, ETFs with substantial allocations to the software giant have come <a href="https://www.benzinga.com/news/earnings/25/01/43320124/microsoft-shares-slide-after-q2-results-cloud-revenue-misses-expectations-details">into the spotlight</a>. 
Despite Microsoft <a href="https://www.benzinga.com/news/earnings/25/01/43320124/microsoft-shares-slide-after-q2-results-cloud-revenue-misses-expectations-details">beating earnings and revenue estimates</a>, concerns over slowing cloud growth led to a sharp 6% drop in the company&#8217;s shares at market close on Jan. 30. However, the stock has slightly pared the loss as of writing on Jan. 31. Investors are now carefully looking at <a href="https://www.benzinga.com/etfs">ETFs heavily weighted in Microsoft</a> to assess potential market implications.
Several ETFs with double-digit exposure to Microsoft have gained attention. Some of the most prominent funds include:
<h1 class="wp-block-heading">MSCI Information Technology Index ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FTEC#NYSE">FTEC</a>)</h1>
• Tracks the MSCI USA IMI Information Technology Index.
• Microsoft holds a 16.5% allocation.
• AUM stands at $11.47 billion.
• Charges an expense ratio of 0.08%.
<h1 class="wp-block-heading">Vanguard Information Technology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VGT#NYSE">VGT</a>)</h1>
• Provides exposure to the information technology sector of the U.S. equity market.
• Microsoft accounts for about 16.65% of total holdings.
• AUM stands at $74.4 billion.
• Charges an expense ratio of 0.10%.
<h1 class="wp-block-heading">T-Rex 2X Long Microsoft Daily Target ETF (BATS:<a class="ticker" href="https://www.benzinga.com/stock/MSFX#BATS">MSFX</a>)</h1>
• Seeks to amplify Microsoft&#8217;s daily performance by 200%.
• Charges 1.05% in annual fees.
• Has an asset base of $7.22 million
<h1 class="wp-block-heading">iShares U.S. Technology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IYW#NYSE">IYW</a>)</h1>
• Provides exposure to U.S. electronics, software and hardware companies. Microsoft holds the second-largest position at 15.15%.
• Tracks the Russell 1000 Technology RIC 22.5/45 Capped Index.
• Assets under management (AUM) stand at $18.27 billion.
• Charges 0.4% in fees.
<h1 class="wp-block-heading">SPDR Select Sector Fund &#8211; Technology (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLK#NYSE">XLK</a>)</h1>
• Microsoft holds 21.5% position among its components.
• Charges an expense ratio of 0.09%.
Also Read: <a href="https://www.benzinga.com/25/01/43381133/chinas-deepseek-r1-lands-on-microsoft-azure-and-awsthe-same-model-that-shook-silicon-valley">China&#8217;s DeepSeek-R1 Lands On Microsoft Azure And AWS — The Same Model That Shook Silicon Valley</a>
<h1 class="wp-block-heading">Microsoft&#8217;s Q2 Earnings Highlights</h1>
Microsoft reported earnings per share of $3.23, surpassing the $3.11 consensus estimate and improving from the prior-year earnings of $2.93 per share. Revenue climbed 12% year-over-year to $69.6 billion, slightly ahead of the consensus estimate of $68.70 billion.
Revenue from the Intelligent Cloud segment rose 19% year-over-year to $25.54 billion, with Office 365 Commercial and Dynamics 365 registering sales growth of 16% and 19%, respectively. The Azure cloud computing platform reported a 31% year-over-year revenue increase, marking a slowdown from 33% in the previous quarter.
Despite exceeding Wall Street expectations in the second quarter, Microsoft&#8217;s forecast for slower cloud growth raised concerns among investors, leading to a post-earnings decline in its stock price.
It is important to note that Microsoft has guided revenue growth across key segments for the fiscal third quarter. The company expects:
 • Productivity and Business Processes revenue between $29.4 billion and $29.7 billion, an 11%-12% growth (constant currency) year-over-year.
• Office Consumer and Cloud Services are anticipated to grow in the mid-to-high single digits, LinkedIn in the low-to-mid single digits, and Dynamics in the mid-teens. 
• Intelligent Cloud revenue is forecasted between $25.9 billion and $26.2 billion, with Azure growing 31%-32% at constant currency. 
• Enterprise Services revenue is expected to grow in the low-to-mid single digits, while Server product revenue is projected to decline in the mid-single digits.
Additionally, the company&#8217;s <a href="https://www.benzinga.com/markets/equities/25/01/43327008/microsofts-13-billion-run-rate-and-openai-azure-deal-spark-surge-in-enterprise-demand-for-ai-solutions-just-first-tranche-of-future-growth-potential">continued investment in AI and data center expansion</a> signals its long-term growth strategy.
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</ul>
Photo: Shutterstock

Sector ETFs

ETFs

BCHP

FTEC

iShares Dow Jones US Technology Sector Index Fund

MSFT

ETF Opportunities Trust T-Rex 2X Long Microsoft Daily Target ETF

MSFX

5 ETFs To Watch During Microsoft's Post-Earnings Drop

SolarWinds Corp&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SWI#NYSE">SWI</a>) reported a fiscal first-quarter 2024 revenue growth of 4% year-on-year to $193.31 million, beating the&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/05/b38580119/solarwinds-announces-first-quarter-2024-results" rel="noreferrer noopener">analyst consensus of $190.84 million</a>.&nbsp;
Adjusted EPS of $0.29 beat the&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/earnings" rel="noreferrer noopener">analyst consensus of $0.22</a>.
Maintenance revenue declined 2.4%&nbsp;Y/Y at $111.72&nbsp;million.&nbsp;Subscription revenue climbed 26.5%&nbsp;Y/Y&nbsp;to $68.76 million, while License revenue declined 25.1% to $12.83 million.
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/government/24/04/38439394/ai-is-going-well-for-microsoft-but-cybersecurity-is-not" rel="noreferrer noopener">AI Is Going Well For Microsoft, But Cybersecurity Is Not</a>
The adjusted gross margin increased by 30 bps to 90.9%, and the adjusted EBITDA margin increased by 600 bps to 47.6%.
SolarWinds held $312.8 million in cash and equivalents as of March 31, 2024.
Outlook:&nbsp;SolarWinds expects second-quarter revenue of $186 million—$191 million, versus the consensus of $191.80 million. It projects&nbsp;an adjusted&nbsp;EPS of $0.21 – $0.23 versus the&nbsp;consensus of $0.22.
SolarWinds&nbsp;<a target="_blank" href="https://www.benzinga.com/news/earnings/24/02/37008393/why-is-solarwinds-stock-trading-higher-thursday" rel="noreferrer noopener">reiterated fiscal 2024</a>&nbsp;revenue of $771 million&nbsp;– $786&nbsp;million versus the consensus of $779.74 million.
SolarWinds expects fiscal 2024 adjusted EPS of $1.00 &#8211; $1.04 (prior $0.95 – $1.00) versus the&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/guidance" rel="noreferrer noopener">consensus of $0.95</a>.
SolarWinds&nbsp;stock gained 26% in the last 12 months. Investors can gain exposure to the stock via&nbsp;SPDR S&amp;P Software &amp; Services ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XSW#NYSE">XSW</a>) and&nbsp;ProShares Big Data Refiners ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DAT#NYSE">DAT</a>).
Price Action:&nbsp;SWI shares traded higher by 2.89% at $11.39&nbsp;at the last check Thursday.

Earnings

Guidance

Software Developer SolarWinds Stock Shines After Q1 Earnings - Here's Why

Model N, Inc.&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MODN#NYSE">MODN</a>) shares are trading higher after the company announced&nbsp;Vista Equity Partners&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/04/b38140265/model-n-to-be-acquired-by-vista-equity-partners-for-1-25-billion" rel="noreferrer noopener">will acquire it for $1.25 billion</a>.
As per the terms, Vista will acquire all the outstanding shares of Model N for $30.00 per share, representing a premium of around 23% over Model N&#8217;s 30-trading-day volume weighted average share price as of the close on January 10, 2024, the day before the Model N Board of Directors authorized its financial advisor to contact potential acquirers.&nbsp;
The purchase price also represents a premium of about 16% over Model N&#8217;s 30-trading-day volume weighted average share price as of the close on April 5, 2024.
The transaction is expected to close in mid-2024, subject to customary closing conditions.&nbsp;
After the deal, Model N will become a privately held company and no longer be listed in any public market.
Jason Blessing, Model N President and Chief Executive Officer, said, &#8220;As a private company under Vista&#8217;s ownership, we will have the added resources to navigate this dynamic market and drive ARR growth for the long term. Vista understands our strengths, culture, and customer-centric philosophy as we position our company to capture market opportunities and accelerate our global impact.&#8221;
Nick Prickel, Senior Vice President at Vista, stated, &#8220;Model N enables leading life science and advanced technology companies to optimize their commercialization and compliance processes with mission-critical products specifically designed to address the complexities of these dynamic markets.&#8221;&nbsp;
Investors can gain exposure to the stock via&nbsp;SPDR S&amp;P Software &amp; Services ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XSW#NYSE">XSW</a>) and&nbsp;First Trust Multi-Manager Small Cap Opportunities ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MMSC#NYSE">MMSC</a>).
Price Action: MODN shares are up 10.13% at $29.83 on the last check Monday.

Small Cap

MMSC

MODN

Why Information Technology Model N Shares Are Surging Today

SoundHound AI, Inc&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOUN#NASDAQ">SOUN</a>) unveiled on Monday that its voice assistant integrated with ChatGPT will be a pioneering entry&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/03/b37912814/first-for-japan-as-soundhound-ais-voice-assistant-with-integrated-chatgpt-launches-in-stellantis-d" rel="noreferrer noopener">into Japanese vehicles</a>.&nbsp;
This marks the introduction of SoundHound Chat AI Automotive as the world&#8217;s inaugural in-vehicle voice assistant featuring generative AI, available from April 2023 and set to be incorporated into Stellantis NV (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STLA#NYSE">STLA</a>) Stellantis DS Automobiles in Japan this month. 
DS Automobiles spearheaded the adoption of this technology, launching into full production at the start of March 2024, offering it in 13 languages across 18 nations.&nbsp;
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/news/24/03/37427869/soundhound-ai-impresses-with-subscription-backlog-surge-analysts-see-positive-outlook-despite-top-li" rel="noreferrer noopener">SoundHound AI Impresses with Subscription Backlog Surge: Analysts See Positive Outlook Despite Top-Line Miss</a>
This advanced assistant, Iris by DS Automobiles, enables users to perform many tasks hands-free, from trip planning to accessing live parking information, leveraging its capability to interact with a broad spectrum of real-time data and large language models such as ChatGPT.
SoundHound&#8217;s innovative approach also significantly mitigates the risk of &#8220;AI hallucinations,&#8221; ensuring more reliable and accurate responses.
The SoundHound Chat AI platform is designed to work seamlessly with any third-party generative AI model, maintaining fluid conversations and providing precise answers across various domains.
With over 20 car brands among its clientele in just seven years, SoundHound AI continues to grow its presence in the automotive industry, now serving over 25% of the market.&nbsp;
The company unveiled an&nbsp;<a target="_blank" href="https://www.benzinga.com/markets/equities/24/03/37819791/whats-going-on-with-soundhound-stock-tuesday" rel="noreferrer noopener">in-vehicle voice assistant</a>&nbsp;powered by&nbsp;Nvidia Corp&#8217;s&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) DRIVE platform to deliver real-time responses. This assistant provides access to SoundHound Vehicle Intelligence, allowing for swift information retrieval through natural speech.
SoundHound AI stock gained over 178% in the last 12 months. Investors can access the stock via&nbsp;Themes Generative Artificial Intelligence ETF&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/WISE#NASDAQ">WISE</a>) and&nbsp;SPDR S&amp;P Software &amp; Services ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XSW#NYSE">XSW</a>).
Price Action: SOUN shares are down 2.94% at $5.96 on the last check Monday.
Photo via Shutterstock

NVDA

SOUN

STLA

Themes Generative Artificial Intelligence ETF

WISE

SoundHound AI Rolls Out First ChatGPT-Enabled Voice Assistant in Japanese Vehicles

<ul>
<li>Health-care billing technology provider&nbsp;Cedar Cares Inc&nbsp;has reportedly raised $200 million in financing from the latest funding round, valuing it at $3.2 billion,&nbsp;<a class="editor-rtfLink" href="https://www.bloomberg.com/news/articles/2021-03-09/health-care-billing-tech-firm-cedar-cares-valued-at-3-2-billion?sref=TBDibEcD" style="color: rgb(14, 16, 26); background: transparent; margin-top:0pt; margin-bottom:0pt;; color: #4a6ee0;" target="_blank">Bloomberg reports</a>.</li>
<li>The $200 million investment was led by Tiger Global Management, followed by Andreessen Horowitz, Thrive Capital, and Concord Health Partners. The valuation was over four times compared to the funding round last year.</li>
<li>Cedar&rsquo;s clients include hospital networks, which utilize its technology for convenient online payment by patients. Customers can further receive text alerts and interact with chatbots to rationalize the billing process.</li>
<li>Andreessen Horowitz reportedly invested in Cedar to improve the health-care financial system and its customer experience.</li>
<li>Cedar witnessed robust growth last year and raised financing in 2020 at a $727 million valuation. The total fundraises, including the current, amount to $350 million.</li>
<li>The coronavirus pandemic has led to efficient health-care businesses, including the promotion of Cedar&rsquo;s products as per Cedar CEO Dr. Florian Otto. The crisis also helped to raise awareness towards the importance of investment in digital experience.</li>
<li>The company will use the funding for growth initiatives, including marketing and sales spending. The company denied any present acquisition attempts or did not share any plans regarding its IPO.</li>
</ul>

Health Care

Offerings

Startups

Media

Healthcare Billing Tech Provider Cedar Cares Valued At $3.2B In Latest Funding Round: Bloomberg

Whether it&#39;s cloud computing, other forms of enterprise, video games or another segment, software stocks and exchange traded funds are growing at torrid paces this year.
On Wednesday, several software ETFs spanning a variety of genres extended their good fortune from the second quarter, soaring to start the third while entering the all-time high club.
Not all software ETFs are alike, but the group has at least <a href="https://www.benzinga.com/trading-ideas/long-ideas/20/05/16081911/why-a-tech-etf-youve-never-heard-of-is-crushing-it-this-year">one thing in common</a>: concerns that the group is becoming overvalued. Then again, growth stocks keep outperforming their value rivals &mdash; and valuation alone isn&#39;t a reason to dump a security.
With the valuation warning in mind, here&#39;s a trio of soaring software ETFs.
WisdomTree Cloud Computing Fund (WCLD)
All the WisdomTree Cloud Computing Fund (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/wcld#NASDAQ">WCLD</a>) has done is more than double off its March lows and gain about 73% in the second quarter. It&#39;s even up nearly 11% since the last time it was <a href="https://www.benzinga.com/etfs/new-etfs/20/06/16158998/a-magnificent-ascent-for-the-newest-cloud-etf">highlighted in this space</a>.
Those numbers are enough to make WCLD, which is the newest of the dedicated cloud ETFs, the leader of that pack this year.
WCLD fills an important void created by many traditional broader market funds: while those products are heavy on tech stocks, the large-cap technology sector is surprisingly lightly allocated to pure play cloud companies.
&ldquo;Given the significant weight the Nasdaq 100 and S&amp;P 500 indexes hold in the Software &amp; Services industry group, investors may be unaware of their limited cloud industry exposure. WCLD may be a fitting solution for adding unique cloud exposure to fill the gap,&rdquo; <a href="https://www.wisdomtree.com/blog/2020-06-29/cloud-exposure-looking-beyond-the-benchmarks">according to WisdomTree</a>.
SPDR S&amp;P Software &amp; Services ETF (XSW)
The SPDR S&amp;P Software &amp; Services ETF (NYSEARCA: XSW) isn&#39;t a dedicated cloud ETF &mdash; and that&#39;s alright. The ETF surged more than 44% in the second quarter and joined the all-time high club&nbsp;Wednesday.
That&#39;s good work for an equal-weight ETF that doesn&#39;t allocate more than 0.77% to any of its 167 holdings.
XSW components are above their long-term valuation metrics in aggregate, but the premiums are warranted.
&ldquo;While the S&amp;P 500 is projected to have negative sales growth over the remaining three quarters of this year, software and services firms are projected to continue to grow their top line each quarter,&rdquo; <a href="https://www.ssga.com/us/en/intermediary/etfs/insights/spotting-trends-sectors-to-consider-in-a-changed-world">according to State Street</a>.
&ldquo;Valuations are a bit above their long-term average for the industry, but with a lack of growth in our current environment the premium for a growth industry with the potential to reshape society is warranted.&rdquo;
Invesco Dynamic Software ETF (PSJ)
The Invesco Dynamic Software ETF (NYSEARCA: PSJ) is another example of a non-dedicated cloud ETF that&#39;s on a roll.
PSJ offers an unique weighting scheme that emphasizes price momentum, earnings momentum, quality, management action&nbsp;and value.
For investors wanting to bet on a basket of smaller software stocks, PSJ is worthwhile idea because just over one-third of its 30 components are classified as large caps.

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3 Scorching Hot Software ETFs

Software equities and the related exchange traded funds slipped last week as coronavirus concerns gripped global markets. Funds with light exposure to Microsoft Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>) were particularly vulnerable last week because that stock remained firm following a stellar earnings report.
<h3>What Happened</h3>
The SPDR S&amp;P Software &amp; Services ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xsw#NYSE">XSW</a>) fell 1.64% last week, but that decline may prove to be more buying opportunity than cause for alarm. XSW holds 165 stocks on an equal-weight basis and the weighted average market value of $28.9 billion of its holdings is on the smaller side compared to some rival software ETFs.
The $240.1 million XSW follows the S&amp;P Software &amp; Services Select Industry Index, which &ldquo;seeks to provide exposure to the software and services segment of the S&amp;P TMI, which comprises the following sub-industries: Application Software, Data Processing &amp; Outsourced Services, Home Entertainment Software, IT Consulting &amp; Other Services, and Software Systems,&rdquo; <a href="https://www.ssga.com/us/en/intermediary/etfs/funds/spdr-sp-software-services-etf-xsw">according to State Street</a>.
<h3>Why It&#39;s Important</h3>
Thanks in large part to the cloud, software stocks could be in for another strong year, assuming the broader technology sector maintains its leadership perch.
&ldquo;The Software &amp; Services industry has historically delivered stronger and more consistent earnings beats than the broader market, as businesses quicken the pace of transitioning to cloud-based software solutions,&rdquo; <a href="https://www.ssga.com/us/en/intermediary/etfs/insights/spotting-trends-3-sectors-we-re-looking-at-in-q1">State Street said in a recent note</a>.
Over 52% of XSW&#39;s holdings are application software companies, levering the fund to demand for enterprise software, including cloud products. Trading at 2.652 times earnings, XSW reflects the growth opportunities being ascribed to that corner of the software universe.
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<h3>What&#39;s Next</h3>
&ldquo;Per Gartner&rsquo;s latest IT spending forecast for 2020, enterprise software spending is expected to grow more than 10% in the coming two years, as larger companies increasingly adopt cloud-based software solutions,&rdquo; according to State Street. &ldquo;After experiencing margin declines in 2018, software companies enjoyed rebounds in EBITDA margins in 2019 and may continue to see margin expansion going forward, as the cloud platform brings scale and operational efficiencies to help lower costs.&rdquo;
Another perk of software companies is that particularly smaller firms, including those found in XSW, typically derive the bulk of their revenue on a domestic, providing some level of insulation for investors if trade tensions flare up again at some point in 2020.
XSW is higher by 89% over the past three years, outperforming the largest dedicated cloud ETF by nearly 1,000 basis points over that span.

A Seductive Software ETF To Buy On The Dip

Software stocks participated in the broader market rally this year, in fact outperforming the broader market by a meaty margin. Does that mean valuations in the space are stretched out?
An analyst at Bank of America delved into key themes that are likely to play out in the software sector in 2020 and presented a list of 10 stocks that are his top picks for the upcoming year.
<h3>Strong IT Spending Environment</h3>
Despite continued fears of an economic slowdown, the IT spending environment is likely to remain strong, analyst <a href="https://www.tipranks.com/analysts/kash-rangan">Kash Rangan</a> said, citing BofA&#39;s channel checks and surveys.
The analyst said his focus in on companies that have solid growth potential, margin expansion opportunity and good track record of the management team.
Rangan said he is increasingly selective on the sector, especially as macro economists call for a &lsquo;&#39;late stage economic cycle with a tilt towards value and concerns about a tech/trade war.&#39;&quot;
Additionally, companies, which were avoided by investors in 2018/2019 due to dilutive <a href=" https://www.benzinga.com/analyst-ratings/analyst-color/19/08/14299342/salesforce-analyst-bullish-ahead-of-q2-print-says-tableau-deal-has-good-revenue-syn"> M&amp;A activity, </a> fearing lower margins for the year, are good for taking a look at, Rangan wrote in the note.
&quot;&hellip;.. we believe these companies are poised to reap the benefits of their acquisitions (less negative impact from deferred revenue write down, product/go to market synergies) on their anniversaries in 2020,&quot; he added.
<h3>Five Themes Impacting Software Companies In 2020</h3>
BofA outlined the following as key themes an investor in the software space should focus on:
Companies on the cusp of realizing the benefits of dilutive acquisitions made in 2019
<ul>
<li>Inflection in digital transformation of enterprise</li>
<li>The rise of DevOps</li>
<li>Software transforming CEO&#39;s office</li>
<li><a href=" https://www.benzinga.com/fintech/19/10/14521184/ai-is-ushering-in-the-new-era-of-integrated-receivables">Artificial intelligence </a> going mainstream</li>
</ul>
<h3>BofA Top Software Picks</h3>
<h2>Large-Cap Stocks</h2>
<ul>
<li>Microsoft Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>) &ndash; Buy/Price Target Raised from $162 to $200</li>
<li>Adobe Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/adbe#NASDAQ">ADBE</a>) &ndash; Buy/Price Target $350</li>
<li>Salesforce.com, inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/crm#NYSE">CRM</a>) - Buy/Price Target Raised from $200 to $215</li>
<li>Workday Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/wday#NASDAQ">WDAY</a>) &ndash; Buy/ Price Target $260</li>
<li>Splunk Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/splk#NASDAQ">SPLK</a>) Buy/Price Target Raised from $170 to $200</li>
</ul>
<h2>Small-Cap Stocks</h2>
<ul>
<li>RingCentral Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/rng#NYSE">RNG</a>) &ndash; Buy/ Price Target $198</li>
<li>Coupa Software Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/coup#NASDAQ">COUP</a>) - Buy/ Price Target $185</li>
<li>HubSpot Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hubs#NYSE">HUBS</a>) - Buy/ Price Target $190</li>
<li>Avalara Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/avlr#NYSE">AVLR</a>) - Buy/ Price Target $100</li>
<li>Twilio Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/twlo#NYSE">TWLO</a>) - Buy/ Price Target $138</li>
</ul>
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<a href=" https://www.benzinga.com/analyst-ratings/analyst-color/19/10/14561336/jefferies-says-software-still-strong-but-focus-on-apps-large-caps-microsoft-gets-up">Jefferies Says Software Still Strong, But Focus on Apps, Large Caps; Microsoft Gets Upgrade </a>
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10 Software Top Picks For 2020: Do You Own Them?

Software stocks have seen an average pullback of 20% from their 52-week highs, as rich valuations and high ownership interest made them susceptible to macro volatility, according to Morgan Stanley.
Notwithstanding the pullback, Morgan Stanley does not see these software stocks as bargains, especially those with high multiples, but highlighted opportunities in growth-at-reasonable-price, or GARP, names.
<h3>The Analyst</h3>
Analyst <a href="https://www.tipranks.com/analysts/keith-weiss"> Keith Weiss </a> downgraded ServiceNow Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/now#NYSE">NOW</a>) from Overweight to Equal-weight&nbsp;with a $267 price target.
<h3>The Thesis</h3>
Software spending growth is expected to decelerate into 2020, with a number of companies experiencing difficult comps into the back half of the year, Weiss said, citing the third-quarter CIO survey.
The analyst sees unfavorable risk/reward for a lot of high fliers in software. He said he sees continued opportunity in several areas of the software group,particularly in names with solid support from P/E, or EV/FCF multiples.
Morgan Stanley said it is buying into:
<ul>
<li>GARP software names&nbsp;with durable earnings growth, thanks to largely ratable revenue base, such as Adobe Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/adbe#NASDAQ">ADBE</a>) and Microsoft Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>).</li>
<li>Beaten-up software names such as New Relic Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/newr#NYSE">NEWR</a>), Smartsheet Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/smar#NYSE">SMAR</a>), Zendesk Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/zen#NYSE">ZEN</a>) and Twilio Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/twlo#NYSE">TWLO</a>)</li>
<li>FCF growth stories that are looking attractive at current levels, such as&nbsp;Twilio Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/twlo#NYSE">TWLO</a>) and Palo Alto Networks Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/panw#NYSE">PANW</a>).&nbsp;</li>
</ul>
The firm remains sidelined on:&nbsp;
<ul>
<li>Companies with high multiples that are&nbsp;operating in a highly competitive environment, such as Zscaler Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/zs#NASDAQ">ZS</a>), Slack Technologies Inc (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/work#NYSE">WORK</a>) and Zoom Video Communications Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/zm#NASDAQ">ZM</a>)</li>
<li>Segments lower on the CIO priority list such as VMware, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vmw#NYSE">VMW</a>) and Citrix Systems, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/ctxs#NASDAQ">CTXS</a>)</li>
</ul>
<h3>Service Now, Atlassian, Citrix Trending</h3>
<a href="https://www.benzinga.com/analyst-ratings/analyst-color/19/07/14136119/the-street-is-mostly-bullish-on-servicenow">Service Now, </a> Citrix Systems and Atlassian Corporation PLC (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/team#NASDAQ">TEAM</a>) are among stocks that are actively sought out.
ServiceNow is a best-in-class SaaS asset growing at 30%-plus, propped up by its $3-billion=plus subscription base, with superior unit economics and FCF margins, according to Morgan Stanley.
That said, the firm sees increasing near-term risks such as a&nbsp;CFO transition, tough comps and high expectations.
<a href="https://www.benzinga.com/news/earnings-previews/19/10/14608828/earnings-preview-for-atlassian-corporation">Atlassian </a>&mdash; a&nbsp; provider of products for improving software development, project management and collaboration &mdash;&nbsp;is scheduled to report its first-quarter earnings Thursday&nbsp;after the market close.
Analysts, on average, expect the company to report earnings per share of 24 cents for the quarter, up from 20 cents a year ago. Revenues are estimated to have risen 31.6% to $351.8 million.
<h3>The Price Action</h3>
At last check, the SPDR S TR/S&amp;P COMPUTER SOFTWA (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xsw#NYSE">XSW</a>) was edging up 0.1% to $95.03.
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Morgan Stanley Sifts Through Software Sector, Flags 'Picks,' 'Holds'

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William Blair Analyst Bhavan Suri Tells Benzinga Weakness In Software Stocks Attributable To 'rotation out of high multiple/high beta into more cyclical stocks,' Believes Investors May Be 'worried about sustainability of growth esp given macro concerns'

The technology sector is again leading the broader market higher and software stocks are significant contributors to that theme. The S&amp;P North American Technology-Software Index, for example, is up more than 27 percent year-to-date.
Cap-weighted software benchmarks and exchange traded funds are widely followed, but some alternative strategies bear monitoring in the third quarter, including the SPDR S&amp;P Software &amp; Services ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xsw#NYSE">XSW</a>).
<h3>What Happened</h3>
The equal-weight XSW follows the S&amp;P Software &amp; Services Select Industry Index. That benchmark offers &ldquo;exposure to the software and services segment of the S&amp;P TMI, which comprises the following sub-industries: Application Software, Data Processing &amp; Outsourced Services, Home Entertainment Software, IT Consulting &amp; Other Services, and Systems Software,&rdquo; <a href="https://us.spdrs.com/en/etf/spdr-sp-software-services-etf-XSW">according to XSW&#39;s issuer.</a>
As an equal-weight ETF, XSW tilts toward smaller stocks. The weighted average market capitalization of the fund&#39;s 127 holdings is $26.72 billion, which is slightly below the mean market value of $27.53 billion on the S&amp;P North American Technology-Software Index.
<h3>Why It&#39;s Important</h3>
XSW is up more than 25 percent year-to-date and currently resides near all-time highs, but the ETF has the potential for more near-term upside.
&ldquo;With growth becoming challenging, investors may want to tilt toward sectors and industries with high growth potential and consistently beating earnings expectations,&rdquo; said State Street Global Advisors (SSgA) in a recent note. &ldquo;In <a href="https://global.spdrs.com/blog/post/2018/jun/strategy-1-position-for-later-stages-of-the-business-cycle-2018-mid-year-outlook-part-3.html">later stages of the business cycle,</a> higher wage pressure and increasing capacity utilization has created incentive for companies to automate with technology and increase productivity with software systems.&rdquo;
Application software makers represent about 36 percent of XSW&#39;s portfolio with data processors and systems software firms combining for about 46 percent.
<h3>What&#39;s Next</h3>
Robust software could trigger more upside for XSW in the second half of 2018.
&ldquo;Thanks to strong demand for enterprise software, global corporate spending on software and services is projected to increase by 6.2% in 2018, the highest annual growth rate forecasted since 2007,&rdquo; said SSgA.
Data suggest investors are displaying enthusiasm for XSW this year. While the ETF has just $103.70 million in assets under management, nearly $33 million of that sum has flowed into the fund just this year.
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A Super Software ETF For Q3

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