Seeking Alpha had two interesting stories about the performance of SaaS stocks in the marketplace. Given that many people predicted earlier this year that SaaS would thrive even in a poor economy, one wonders whether the predictions may be starting to come true.
The first story by Joe Panettieri pointed out that SaaS stocks seem to be up nearly 15% in July, at least according to MSPmentor's SaaS 20 Index. The reason appears to be rapid revenue growth and earnings rather than hype.
In a separate article, Sramana Mitra points out the top 8 SaaS stocks on the market right now that she is tracking. The first, to no one's great surprise, is Salesforce.com, which has recently announced great second quarter results.
Her list includes other big names, like SuccessFactors, Taleo, and Omniture -- but also Salary.com, a company you don't usually think of first when someone says SaaS. Surprisingly, Salary.com is thriving right now and its stock has gone up considerably in the recent past. Makes you wonder whether a lot of people are planning to ask for a raise in the near future.
I did read the article by Sramana earlier. I think the rise of SaaS stocks are noteworhty. A caveate worth noting - S&P 500 has risen by 4.5% over the last one month.
In short, the rise of SaaS stocks are substantial but is not mind boggling. Or is it?