The next digital transformation is already well underway.
With more and more things moving online so quickly these days in response to COVID-19, I really don’t have to remind you.
But the scope of all the growth is probably a whole lot bigger than most of us can imagine.
I’ve recently been listening in on earnings calls and reading through press release commentary by leaders at big name cloud, data, and digital connectivity companies.
Some of the takeaways include the use of video as a “new voice” and an emphasis on building a better internet.
Here is, briefly, what a couple of them have to say…
“As remote work trends have accelerated during the pandemic, organizations have moved beyond addressing immediate business continuity needs to actively redefine and embracing new approaches to support a future of working anywhere, learning anywhere, and connecting anywhere.”
~ Eric Yuan, Zoom Video Communications CEO
“We believe the pandemic forces companies to distort their vendors into two buckets, nice to have and must have. All indications from the quantitative metrics we’re watching as well as the qualitative conversations we’re having with customers are that Cloudflare is squarely in the must have bucket.”
~ Mathew Prince, Cloud Flare CEO
Obviously I’ve been writing a whole lot about ZM, given it’s been the most talked-about stock in the lastest digital transformation trend.
But I want to share a few other digital transformation names that have shown up on my watchlist this week.
Bill.com (BILL) is a company that facilitates bill pay and invoicing in an intelligent and remote way.
BILL beat Wall Street expectations for their earnings results last Thursday and the stock nevertheless dropped after they reported.
The company showed a revenue increase to $42.1 million from $31.7 million the year before, which was beyond the FactSet expectation.
It showed a runup into earnings though, much like we’ve been seeing with a lot of digital and remote work stocks, including Zoom (ZM) and Crowdstrike (CRWD)… and Bill historically follows its peers.
On the fundamental side, BILL has been strengthening their partnerships with financial institutions, accounting software companies, and accounting firms.
And right now, the company is showing a pullback and could rally back to its current resistance level.
The 10-day volume sits at 2.05 million and I anticipate that the stock could show more growth in the coming weeks.
Also operating in the digital space, Cloudflare (NET) provides faster and more reliable web-infrastructure as well as more website security.
And much like BILL, NET topped Wall Street’s earnings expectations.
The company reported earnings on August 6, and revenue leapt 48% to $99.7 million from the year before.
The stock has been receiving a lot of strong analyst buy ratings, which is unsurprising given it’s strong revenue increase.
The stock was showing a whole lot of growth over the 5 months leading up to it’s earnings announcement and has been consolidating in August.
I wouldn’t be surprised if we get another strong pop off these recent lows.
Ping Identity (PING)
As everything moves digital, web users are increasingly vulnerable to identity theft.
Identity security company, Ping Identity (PING), is a leader in facilitating password protection and secure logins.
That’s possible through their multi-factor authentication, single sign-on, access security features.
The company also provides directory, data governance, and intelligent API cybersecurity.
Despite falling beneath earnings expectations, PING reported a good recent quarter.
Revenue came out to $59.0 million as opposed to the $60 million anticipated by analysts surveyed by FactSet.
On the technical side, the stock has been showing a strong pattern of growth with lower lows and higher highs.
I think it could be a good opportunity to jump in soon before the stock reaches its most recent resistance.
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