If the top stocks usually yield the top returns, then it pays to know what our 110,000-strong Motley Fool CAPS community likes right now. Here are their five favorite software companies:
|
Price as of 6/24 |
CAPS Stars (Out of 5) |
One-Year Return |
|
|---|---|---|---|
|
GlobalScape |
$1.88 |
***** |
(49.6%) |
|
Double-Take Software |
$13.75 |
***** |
(13.3%) |
|
Infosys Technologies |
$43.92 |
**** |
(12.5%) |
|
CryptoLogic |
$14.29 |
**** |
(41.8%) |
|
Adobe Systems |
$41.38 |
**** |
1.3% |
Sources: CAPS, Yahoo! Finance.
Fascinating, isn't it? Premium-priced winners such as VMware
GlobalScape gets the nod instead. CAPS All-Star johnkernan22 says it's "truly a hidden gem." His reasoning? Fundamentals. GlobalScape's returns on equity and invested capital exceeded 25% over the trailing 12 months. That's a good sign.
Still, although I recognize that high-performing micro caps can make you rich, I have two problems with GlobalScape. First, it specializes in file-transfer software -- programs for uploading documents and other stuff to the Web. There's very little that's unique about FTP; free tools are easy to find. Second, the top software investors have bypassed GlobalScape in their CAPS portfolios. Behold:
|
Top Software Investors |
CAPS Rating (Out of 100) |
Owns GlobalScape? |
|---|---|---|
|
97.76 |
No |
|
|
92.85 |
No |
|
|
92.25 |
No |
|
|
99.14 |
No |
|
|
72.23 |
No |
Source: CAPS.
To be fair, GlobalScape is a micro cap and as such can't be rated right now in CAPS. But it was ratable not long ago; 85 CAPS investors still "hold" shares -- only one is bearish.
Take it from the top
So if GlobalScape is out, which software stock should you buy now? Our top five investors might say Apple
Each of our software superstars believes the Mac's daddy will beat the S&P 500. Here's how tbolioli pitched the stock in December, in a re-up from a successful pick in September 2006:
This one is a triple bagger for me ITRW (in the real world). Too bad I cannot pick it up for $20 here. Still has room to grow and the company has matured in how it approaches products and product development. The iPhone is only the beginning in the mobile space.
Fool co-founder David Gardner agrees. He made Apple a pick for Motley Fool Stock Advisor in February.
I, too, would be buying if I could ever stop writing about the company. My thesis is that the iPhone will catapult Apple products into the enterprise as never before. The new MobileMe software will help. (It's worth a mention, since we're supposed to be talking about software in this column.)
But that's my take. What's yours? Use the comments box below, and then let your opinion be heard by rating stocks in CAPS. Click here to get started; it's 100% free to participate.
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