US Software Sector Rebound: 10 Undervalued Stocks to Watch

The US software sector has been battered in 2026 by fears over AI disruption, but Salesforce's explosive earnings have sparked renewed interest. The company reported adjusted EPS of $5.90, far above the $3.27 consensus estimate, and revenue reached $11.35 billion, up 11% year-over-year.

As a result, several strategists, including those at JPMorgan, argue that these fears are overstated. The sector has rebounded sharply since late July, with the iShares Expanded Tech-Software Sector ETF (IGV) gaining nearly 17% from its recent low and outperforming the Nasdaq 100.

We identified 10 US software stocks that meet specific criteria, including market capitalization greater than $20 billion and upside potential of more than 20%. These undervalued stocks are currently trading at a discount of 20.6% to 59.5% based on Fair Value.