Adobe, MongoDB, Salesforce provide worthwhile risks among software: Piper Sandler

Adobe (NASDAQ:ADBE), MongoDB (NASDAQ:MDB) and Salesforce (NYSE:CRM) are considered some of the most worthwhile risks among cloud software stocks, according to an extensive report by Piper Sandler.

“We recommend large-cap growth investors lean into more risk and add to positions in Big ‘MAC’,” said Piper Sandler analysts, led by Brent Bracelin.

The “Big Mac” in this case refers to MDB, ADBE and CRM.

“These are off-consensus ideas still on average 26% below the 52-week highs with healthy product+margin catalysts and favorable risk-reward profiles,” Bracelin added.

After MongoDB hit a trough during the second quarter, it could experience accelerated growth ahead. MongoDB shares have fallen 29% year to date. Piper Sandler believes this stock could recover that 29% loss in the quarters ahead to reach $335 as the company remains a high-quality database franchise.

Adobe is in a similar position, as it appears ready to recover its losses this year due to its latest AI-powered offerings.

“The new innovation product cycle is underappreciated, and could help reignite growth,” Piper Sandler noted.

Salesforce hasn’t experienced a year-to-date share price decline like MongoDB and Adobe. In fact, it’s up 9% year to date, but is down nearly 5% over the past six months.

“We see 11% upside to $325 price target alongside a bull-case scenario supporting 39% upside to $405,” Bracelin noted.

“Salesforce’s stock has gained 15% since July, outperforming the broader U.S. market, driven by consistent revenue growth and improved profitability,” said Seeking Alpha analysts Dair Sansyzbayev. “The release of Agentforce enhances CRM’s offerings, boosting differentiation and pricing power, with a 38% upside potential.”

Piper Sandler rates Adobe at Overweight with a $635 price target; Salesforce is rated Overweight with a $325 target; and MongoDB is also rated Overweight with a $335 price target.