Shares of the workplace automation company Atlassian (TEAM -3.76%) were climbing today as tech investors reevaluated the recent sell-off of many software stocks.
While there wasn't any specific company-related news driving Atlassian stock higher, investors may be starting to agree with a recent Morningstar analysis that found that some leading tech stocks are "undervalued."
Atlassian stock was up as much as 6.3% this morning and had gained 4.4% as of 11:28 a.m. ET.
Image source: Getty Images.
Time to give software stock a second look
Software stocks have, generally, experienced significant declines over the past six months as investors have grown increasingly concerned that artificial intelligence will disrupt traditional software companies. Atlassian shares are down about 54% over this time.
But some of that fear has been misplaced as tech companies have incorporated AI into their existing software. Atlassian has adapted as well, adding artificial intelligence services like its Rovo agent to its apps to improve data access and enable customers to create their own AI agents.
And some tech investors now appear to be regaining their appetite for software stocks, believing that they're now undervalued. That's Morningstar's perspective, which released a list of 12 tech stocks it deemed "undervalued" earlier this month, with Atlassian near the top.
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Key Data Points
Atlassian shares look like a good deal
Morningstar's fair value estimate for Atlassian's stock is $220 right now -- representing significant upside from the stock's current price of about $70. And the average analysts' price target for Atlassian shares is about $151, more than double the stock's current price.
Investors appear to have gotten the message today and are rushing in to buy Atlassian shares while they're still a good deal.
