The Nasdaq Composite (NASDAQINDEX:^IXIC) has been on fire, and Tuesday continued the upward momentum for the tech-heavy benchmark. As of just before noon EDT, the Nasdaq was up by triple digits, rising almost 1% and easily leading its broader-market peers.
Contributing a lot to the Nasdaq's gains on Tuesday was the latest quarterly report from Zoom Video Communications (NASDAQ:ZM), which sent that stock up more than 30%. However, there are two other tech stocks in the software-as-a-service arena that are hoping to deliver equally impressive results later this week: CrowdStrike Holdings (NASDAQ:CRWD) and DocuSign (NASDAQ:DOCU).
Appealing to the crowd
CrowdStrike shares rose 10% at midday on Tuesday as investors anticipate the company's latest results. CrowdStrike expects to release its quarterly report Wednesday afternoon.
Even before Zoom reported, CrowdStrike was already getting favorable press. Analysts from RBC and Barclays both boosted their price targets on the cybersecurity platform provider, setting new levels of $120 and $130 per share, respectively. Both levels are now firmly in the rearview mirror for the stock after Tuesday's gains.
Zoom's eye-popping growth figures have called into question just about every revenue estimate from tech companies even peripherally related to digital transformation efforts. Shareholders increasingly believe that previous guidance from CrowdStrike will prove far too conservative, and they're hoping that a strong beat could lead to double-digit percentage gains like Zoom has enjoyed.
With more companies going online than ever before, CrowdStrike's cybersecurity suite is a powerful and increasingly vital tool. That could help spur growth for the company both now and well into the future.
DocuSign also got a nice lift, with shares jumping 13%. The electronic signature provider will report its quarterly results on Thursday.
Just as the COVID-19 pandemic forced people to use Zoom's videoconferencing tools in order to replace face-to-face meetings, so, too, has DocuSign benefited from the need to have documents signed electronically in an effective and legally binding way. The majority of top tech, finance, and pharmaceutical companies have turned to DocuSign for assistance, and hundreds of millions of people use its technology to get things done.
DocuSign has high aspirations. It wants not only to help people sign documents but also handle the entire process of preparing legal agreements, including document preparation and following up on required action after agreements get signed.
Like CrowdStrike, DocuSign has already seen its share price rise sharply so far in 2020. Yet with a lot of promise for additional growth, investors still believe that DocuSign could have further to run.
Keep your eyes on CrowdStrike and DocuSign
On Wall Street, lightning often strikes twice. That's what investors are hoping for from CrowdStrike and DocuSign, and if the stocks deliver even a portion of the gains that Zoom did, then most shareholders will be quite pleased.