Proofpoint Expanding Footprint Via Acquisitions

According to a recent Research Report World report, the global enterprise cyber security market is expected to grow at 18% CAGR through 2025. The cloud-based enterprise email security, e-discovery, and compliance service provider Proofpoint (Nasdaq: PFPT) recently announced its first quarter results that surpassed market expectations. This was the fourth consecutive quarter that Proofpoint beat market expectations.

PaaS: Six Cloud Stock Picks Based on PaaS Prospects

Cloud products often tend to have low switching costs. The best way to create exit barriers is to have a Platform-as-a-Service (PaaS) strategy and invite entrepreneurial developers to come develop apps on it. As apps gain traction, some of the startups developing them can be acquired. Integration is easy because of the technology stack compatibility.

This is my analysis of how SaaS companies need to be scaled inorganically.

With this lens on, I have identified a set of cloud stocks that look promising for the next decade.

1. Salesforce.com (NYSE: CRM). Their lead is so great in this space, that the chance of anyone else catching up is minuscule if not zero. Further analysis here.

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Tableau Needs a PaaS Strategy

According to a Market Reports report published earlier this year, the  global data visualization market is estimated to grow 9.5% annually to $7.76 billion by 2023 from $4.51 billion in 2017. Tableau (NYSE: DATA) is a leading player in the market, but the company is leaving a lot of money on the table by not pursuing a developer ecosystem strategy more aggressively.

BigBasket’s Acquisitions

According to a Goldman Sachs report, the Indian online grocery market is expected to reach $40 million in FY2019 and is expected to grow at a CAGR of 62% from 2016 to 2022. According to Crisil, online grocery in India is expected to grow between 65-70% annually to $1.4 billion by 2020. A leading player in this industry is BigBasket, which recently joined the Billion Dollar Unicorn Club.

Cloud Stocks: Should Alarm.com Follow a PaaS Strategy?

According to a Market Watch report, the global connected home market is estimated to grow 14% annually to reach a valuation of more than $138 billion by 2026. Connected homes include the ability to operate and connect various devices and appliances including those that provide security, healthcare, energy management, media, lighting, and kitchen solutions with mobile and internet connected devices. The high growth rate of the market has attracted tech giants like Amazon and Google to enter the space too. One early participant in the market is Virgina-based Alarm.com (NASDAQ: ALRM) that provides security solutions for smart homes and businesses.

Google Should Emphasize PaaS and AI Strategy to Mitigate Advertising Slowdown

Earlier this week, Google’s parent, Alphabet (Nasdaq: GOOG) reported its first quarter results that, surprisingly, missed market estimates and sent the stock tumbling. A slowdown in the revenues caused the stock to fall 9% post announcement, making it the worst day for the stock since 2008.

Cloud Stocks: Expect ServiceNow to Acquire From App Marketplace

Last week, cloud-based enterprise services provider ServiceNow (NYSE: NOW), announced its first quarter results that outpaced market expectations and sent the stock soaring. ServiceNow’s stock has soared 275% in the last three years and 28% in the previous quarter alone. Analysts expect its price rise to continue in the next twelve months with some forecasting price rise of over 10% in the period.

Microsoft Became a Trillion Dollar Company Thanks to Azure

Last week, Microsoft (Nasdaq: MSFT) announced its quarterly results that surpassed market expectations and sent the stock soaring. Not only did its stock scale record high levels, but its value also sent Microsoft into the trillion-dollar valuation territory. It became the third public company to cross that threshold after Apple and Amazon did that last year.