Top 3 Cloud Computing Stocks To Buy Right Now

It is undeniable that the world has changed over the past year. While the digital transformation of society was already underway and even accelerating, the home orders of 2020 and the urgent need to convert a large number of jobs into remote workstations led many companies to adopt for the first time cloud computing solutions.

Once businesses experience the convenience that comes with employees being able to access their apps, data, and platforms from anywhere, there is simply no turning back. And the list of products and services available through the cloud is long and growing. The cloud computing market, which reached approximately $ 371 billion in 2020, is expected to exceed $ 832 billion by 2025.

Naturally, investors are looking for the best ways to take advantage of this opportunity and ride the growing wave of cloud adoption. These three companies offer their shareholders clear opportunities to profit from the trend.

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1. NVIDIA: The World’s # 1 Data Center Choice

While NVIDIA (NASDAQ: NVDA) It may not seem like a cloud computing company at first glance, you will have to look very far to find a major data center that is not using its cutting edge processors.

Almost all of the world’s major cloud providers are turning to graphics processing units (GPUs) from NVIDIA to help them process data. The list includes Amazonof (NASDAQ: AMZN) AWS, Alphabetof (NASDAQ: GOOGL) (NASDAQ: GOOG) Google Cloud, International Business Machines“IBM Cloud, Microsoftof (NASDAQ: MSFT) Azure and Ali Baba Cloud – and that’s just the big dogs. Many smaller operators also rely on NVIDIA GPUs to keep data flowing.

Why NVIDIA? Its state-of-the-art GPUs feature unparalleled parallel processing capabilities, allowing them to handle multiple complex mathematical calculations simultaneously. Turns out, this ability isn’t just the key to rendering realistic images in video games – it’s also the best available solution for powering AI systems and supporting cloud computing.

In the first nine months of 2020, NVIDIA’s revenue grew 49% year over year. However, its data center segment, which provides processors for cloud computing, data centers, and AI, grew 138% over the same time period – and it may just be one start.

With the widespread adoption of cloud computing and the need for corporate GPUs to power the servers that underpin it, NVIDIA has a long and successful trail.

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2. Atlassian: helping remote teams bridge the gap

One of the byproducts of the upheavals of the past year is the growing recognition that the rise of remote working will survive the pandemic. In fact, 74% of CFOs say their company intends to permanently transfer at least some employees to remote work, according to a survey by Gartner. As a result, teams will continue to need effective tools to help them collaborate over long distances.

It’s there that Atlassian (NASDAQ: TEAM) It provides a cloud-based platform that adapts to the increasingly decentralized world of work, allowing colleagues not only to communicate in real time, but also to collaborate on assignments, delegate tasks, share content and manage projects. The Atlassian Marketplace also offers over 4,000 third-party apps to personalize the experience, and recently hit the milestone of over $ 1 billion in lifetime sales.

In its first fiscal quarter, which ended on September 30, Atlassian’s revenue grew 26% year over year. Perhaps more importantly, its subscription revenue – driven primarily by cloud-based products – grew 38%. These strong financial results are the result of solid customer gains. It added 8,620 new net customers during the quarter, bringing its total to 182,717. Year over year, that number increased 14%. This clientele includes an impressive 83% of the companies that make up the Fortune 500.

Atlassian sits at the intersection of three massive and growing markets: software, IT management and general labor management. These combine to create a total addressable market for the company of $ 24 billion. Given Atlassian’s 12-month revenue of just $ 1.7 billion, it should offer plenty of opportunities for continued growth.

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3. Amazon: pioneer and still king of the hill

It’s hard to have a discussion about cloud computing without talking about one of the pioneers in the field: Amazon. When Amazon Web Services (AWS) debuted in 2006, it became the first to offer an Infrastructure as a Service (IaaS) platform, a precursor to modern cloud computing. The company had the market for itself for several years, and it continues to dominate the space today.

At the end of 2020, Amazon controlled around 32% of the cloud infrastructure services market, with Microsoft’s Azure and Google Cloud in second and third place at 19% and 7%, respectively, according to data compiled by the analyst from Canalys market.

It’s hard to overstate the importance of cloud computing to the tech giant. For the first nine months of 2020, AWS was responsible for nearly 13% of Amazon’s revenue and 62% of its operating profits, while generating operating margins of over 30%.

This cash flow and profit helped fund much of the expansion of Amazon’s other business segments. This is especially true for its international e-commerce operations, which always operate around the break-even point.

Even 15 years after its debut, AWS continues to grow at a remarkable rate, especially given its size. In the first nine months of 2020, AWS grew by 30% compared to the previous year period.

Given the accelerated adoption of cloud computing that resulted from the pandemic, don’t expect Amazon’s gains in this area to stabilize anytime soon.