It has been quite the ride for investors in a range of software stocks lately. The rise of artificial intelligence (AI) is starting to have some negative consequences for a handful of companies that are now looking disruptable for the first time ever. To be honest, this wasn't the turn I expected to see — but this is where we're at during this point in the market cycle.
Indeed, I'm getting reminders of what the dot-com boom entailed. The recent decline in a range of previously high-flying growth stocks is notable and concerning, with some key names in the sector still down significantly from their recent peaks near the end of 2025.
That said, this past week brought a welcome rebound for a number of top software stocks, with news that Anthropic hosted an event touting new AI tolls. The news is raising hopes that fresh partnerships could result in some tech names being relatively insulated from future disruption.
Let's dive into what was announced at the event, and which companies analysts are now honing in on.
Which Software Stocks Are the ‘Chosen Ones’?
Anthropic's event on Feb. 24 focused on a range of AI tools that connect with existing software platforms such as Docusign (DOCU), LegalZoom (LZ), and Salesforce (CRM) and its Slack platform, among others.
These companies have platforms that Anthropic is looking to integrate with, using its Claude Cowork platform (and associated upgrades) to improve productivity across applications. Indeed, if we do move toward a partnership-heavy model down the line, investors' fears may be allayed. That's what many in the market were hoping for, and the reaction in these names specifically is evidence of that reality.
While the potential competition risk remains elevated for a number of software names, there are cases such as Docusign — which has a dominant position in legal signatures used by many enterprise clients, for example — that are difficult to disrupt. Switching costs are high, and this is a company that's absolutely minting cash. See the company's fundamentals above. The same goes for LegalZoom, for the most part.
In Salesforces's case, investors are dealing with a company with some of the best margins and operating metrics in its space. Indeed, these metrics are world-class, and investors do appear to be breathing easier after the Anthropic announcement.
Personally, I think that this announcement could lead to a continued bid for all three of these names — DOCU stock, LZ stock, and CRM stock — although we'll have to see if investors can climb the proverbial wall of worry once again. Analysts at Wedbush predict that “models aren’t capable of replacing entire workflows that remain ‘deeply embedded’ in software infrastructure.” I tend to agree with such a view, but it's not my opinion that matters. Market participants each act in their own interests, and that's what makes markets.
With that said, let's dive into where other Wall Street analysts think each of these companies are headed from here.
What Do Wall Street Experts Think of These Software Stocks?
In the case of Docusign, it's clear that Wall Street analysts still have a very bullish opinion of how DOCU stock will perform over the course of this year. Looking at the average price target, a near-doubling of Docusign's stock price is being priced in by analysts, although I'd imagine some of this potential upside is likely tied to analysts being behind the curve in anticipating the sort of decline we've seen over the past 12 months.
For LegalZoom, it's much of the same. However, using the average analyst price target of $9.14, the implied upside for LZ stock is closer to 30% — still not a bad potential return at all.
Salesforce has a similar outlook, according to analysts following CRM stock, with 58% potential upside from current levels.
In short, if Wall Street is correct on the direction of movement for these stocks over the course of the next year, there does appear to be plenty of upside to be had by buying this dip. We'll have see, but I tend to err on the side of the experts on these three software stocks.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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