Workday, Salesforce lead SaaS stocks higher as Credit Suisse sees potential for increased IT spend

Jun. 24, 2022 1:37 PM ETWorkday, Inc. (WDAY), CRMIBM, AMZN, MSFT, ORCL, CSCO, ADBE, NOWBy: Chris Ciaccia, SA News Editor3 Comments

Workday headquarters in Silicon Valley

Sundry Photography/iStock Editorial via Getty Images

Workday (NASDAQ:WDAY) and Salesforce (NYSE:CRM) led software-as-a-service stocks higher on Friday, one day after investment firm Credit Suisse noted both firms could see an increase in spending over the next few years.

Analysts Sami Badri and George Engroff noted that back-office applications and front-office application software would likely see an estimated increase in spending in 2026, compared to 2022 and 2021. Back-office spending would rise to 10.1% of IT budgets in 2026, up from 8.6% currently, while front-office and customer relationship spending would rise to 9.3% in 2026, up from 7.6% currently.

In a survey conducted by Credit Suisse, 18% of respondents said Salesforce (CRM) would see the largest increase in IT spend in 2022, compared to 2021, behind only Microsoft (MSFT), Amazon Web Services (AMZN) and ServiceNow (NOW).

Comparatively speaking, 3% of respondents said Workday (WDAY) would see the largest percentage increase in IT spend in 2022, compared to 2021.

Just 11% of respondents said Salesforce (CRM) would see the largest decrease in spend this year from last year, while 4% said Workday (WDAY) was their response.

Oracle (ORCL), IBM/Red Hat (IBM) and Cisco (CSCO) were the three firms that received the most responses for the largest decrease in spend.

Salesforce (CRM) and Workday (WDAY) both gained more than 6% on Friday.

Several other software-as-a-service stocks also rose, including roughly 2% gains for Microsoft (MSFT), ServiceNow (NOW) and Adobe (ADBE). Oracle (ORCL) also rose, gaining more than 3.5%.

Earlier this month, technical research shop Thrasher Analytics listed Workday (WDAY) among a group of stocks that are most important to hedge funds.

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