Key insights
- ServiceNow's significant post-earnings surge suggests a potential resurgence in the SaaS sector, which has lagged behind AI and semiconductor plays. This could indicate a rotation back into software companies, potentially leading to a sustained "boom" if broader market conditions and company performance remain strong. The market is evaluating whether this is a temporary shift or the start of a new multi-year trend for SaaS valuations.
I've mostly been focused on AI names and semis, but seeing $NOW jump 10% after earnings/news has me wondering if the market is starting to reward software again.
For the last few years it felt like SaaS was dead money compared to chips and infrastructure plays. Now companies like ServiceNow seem to be putting up strong numbers and getting premium valuations again.
Do you think we're entering another multi-year SaaS run, or is this just a temporary rotation while AI spending works its way through the system?