3 Cloud Stocks to Ride the Unstoppable Wave of Remote Work

Stocks to buy

Investor interest in the cloud computing industry has exploded recently due primarily to the innovative technology movement occurring with data centers, machine learning, and generative artificial intelligence (AI). Companies such as Alphabet (NASDAQ:GOOGL) have increased their total cloud revenue year-over-year by 26% while Salesforce (NYSE:CRM), one of a handful of pure-play cloud stocks, saw its share price grow by over 75% last year.

Overall working conditions for most Americans have drastically changed since the pandemic. The work-from-home movement has expanded rapidly and continues to grow allowing companies to thrive with products and services that benefit remote workers.

Here are some options for investors looking for exposure within the cloud computing industry that are capitalizing on this incredible wave of remote work that has been sweeping across the corporate world and growing gig economy.

Snowflake (SNOW)

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Snowflake (NYSE:SNOW) operates a data cloud platform that offers a wide range of workload applications, including generative AI, cybersecurity, engineering, and data sources. The company is a quickly expanding internet service company that only started trading on the NYSE in late 2020.

In the last six months, its share price has jumped by nearly 50%. Last year, Snowflake unveiled multiple machine learning and generative AI models. Snowflake Cortex is a language-learning software with advanced search capabilities. Snowflake Notebooks assists users with programming workflow. The U.S. government also recently authorized Snowflake to provide its cloud platform capabilities for data protection.

Snowflake announced year-over-year growth in product revenue of 34%. Free cash flow increased by 70% to $111 million within the same time period.

Innovation within the generative AI and cloud computing industries has investors interested in its growth trajectory. SNOW stock is another company riding that wave.

Workday (WDAY)

Source: Sundry Photography / Shutterstock.com

Workday (NASDAQ:WDAY) is a business management company that operates a cloud platform for human resources, workflow, financial management, and supply chain uses.

The company has been on the fast track to growing success recently. WDAY stock has risen by 63% within the last year. The gains were fueled by a notable shift in subscriber growth, which grew 18% year over year..

Workday’s third quarter financial result for 2023 stated total revenue increased by 17% compared to the third quarter of 2022. A reported net loss of $75 million for Q3 2022 improved to net income of $114 million in Q3 2023. The company also announced new generative AI products that optimize planning and management capabilities as well as partnerships to provide human resources and payroll improvements.

Workday has seen consistent growth. Following improved guidance on Q4 2023 subscriber revenue and leadership changes, it should continue into 2024. The shift to a larger remote work environment gives Workday and its HR management business increased growth capabilities.

ServiceNow (NOW)

Source: Sundry Photography / Shutterstock.com

ServiceNow (NYSE:NOW) offers workflow automation services for applications such as information technology, governmental agencies, and human resources. Last month ServiceNow announced its earnings results for the fourth quarter and full year of 2023. It said subscriber numbers grew nearly 30% year over year while total revenue grew 26% within the same period.

The company also announced several strategic partnerships. There is a multi-year deal with Visa (NYSE:V) to improve its payment processing services and another with Amazon‘s (NASDAQ:AMZN) cloud service to provide ServiceNow’s automation platform to its marketplace. A third agreement with DXC Technology (NYSE:DXC) will help improve its generative AI proficiency.

Over this past year, NOW stock increased by 75% due to the increasing demand for its automation software that revolutionized the industry. ServiceNow also increased its overall outlook for the first quarter of 2024 for subscriber revenue and operating margin.

ServiceNow has seen impressive development in its workflow automation software. It enabled the company to make many essential partnerships that improved its reputation. And the upside potential for ServiceNow is fairly substantial due to the rapid expansion of the work-from-home movement.

As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Noah has about a year of freelance writing experience. He’s worked with Investopedia dealing with
topics such as the stock market and financial news.

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