Right. So, the market. It’s…high. Which is good, I suppose. Except, not everything is participating in the general merriment. Specifically, the Software-as-a-Service (SaaS) sector. It’s having a bit of a moment. A downward one. It feels a bit like being at a party where everyone else is having fun and you’ve just realized you’re wearing mismatched shoes. Which, incidentally, is a recurring theme in my life.
The current theory, as I understand it (and frankly, it changes hourly), is that companies are either going to build everything themselves (ambitious, but good luck with that) or AI is going to make all existing software redundant. Every time Anthropic announces something new with Claude, which apparently writes code better than most humans I know, SaaS stocks take a tumble. It’s a bit unsettling. I keep imagining a future where robots are running everything and I’m…well, I haven’t quite worked that part out yet.
Anyway, I’ve been trying to focus on the companies that might actually survive this. The ones that might even, dare I say it, thrive. It’s a bit like sifting through a very messy drawer, looking for something useful. After much caffeine and spreadsheet analysis, I’ve landed on two. And honestly, I’m hoping I’m right. My portfolio is depending on it.
ServiceNow
Okay, so ServiceNow. It started as IT service management, which sounds terribly dull, but apparently it’s quite important. It’s now expanded into HR and customer service, which is…sensible, I suppose. The key thing is that it connects everything. All the different departments. It’s like a really efficient office manager. Which, let’s be honest, is a rare and precious commodity.
This is important because AI needs data. Clean, organized data. No hallucinations, as they call them. Apparently, AI hallucinations are bad. Especially if they mess up a company’s operations. It’s like giving a toddler a very expensive piece of equipment. Disaster is likely to follow. ServiceNow is good at keeping things organized. It’s embedded with its customers. Security protocols, audit trails, the whole nine yards. It’s not easily replaced. Which is reassuring.
They’ve also embraced AI themselves. Now Assist, their generative AI suite, is doing well. $600 million in annual contract value, apparently. They’re also aiming to be an “agentic AI orchestration platform.” Which sounds…complicated. They’ve acquired a couple of companies, Armis and Veza, to add asset visibility and rights permission. It’s all a bit much, frankly. But I’m trying to stay optimistic.
The stock has dropped, which is good for me, as it means I can buy more at a lower price. It’s currently trading at a forward price-to-sales ratio of 6.5 and a forward price-to-earnings ratio of 24 times. Which, according to my calculations (and I’ve checked them three times), is…reasonable. It could be a good rally candidate. I’m hoping it is. I really, really am.
Salesforce
Salesforce. Another SaaS name caught in the downturn. They do customer relationship management, which sounds…important. They’ve also added Slack, Tableau, and MuleSoft. It’s like they’re trying to be everything to everyone. Which is…ambitious. And possibly exhausting.
Like ServiceNow, they’re good at connecting data. They’ve launched Data 360 (formerly Data Cloud) to unify data from various sources. They’ve also acquired Informatica, a master data management company. It’s all about having a single source of truth. Which, in theory, is a good thing. It’s like having a really organized filing system. Which I definitely do not have.
This positions them well for agentic AI. Apparently, having a “system of record” is a big advantage. It’s like having a really good map. You know where you are and where you’re going. It’s all very logical. I wish my life was more logical.
The stock has also dropped. A forward P/E of 13.5 times and a forward P/S multiple of just above 3.5 times. It’s on the “clearance rack,” as they say. Which is good. It means I can buy more. And maybe, just maybe, it will rally later this year. I’m trying not to get my hopes up. But it’s difficult.
Units of Cryptocurrency Lost: 12. Hours Spent Watching Charts: 9. Number of Panicked Texts to Friends: 24. Will become disciplined long-term investor: Highly unlikely.
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2026-02-27 00:03