CNBC’s Jim Cramer on Wednesday said that software company acquisitions that have gotten rolling in recent weeks suggest that stocks in the sector could be close to bottoming.
“The long software nightmare may finally be over, although I still urge you to be selective with these things and stick with the ones that actually make money,” the “Mad Money” host said.
Some recent acquisition news among software companies includes:
Software stocks that soared during the pandemic came crashing down this year after the Federal Reserve started an aggressive campaign to raise interest rates and tamp down inflation. Some analysts are betting that the pain for software stocks is coming to an end.
Recent announcements of takeover bids and deals involving software companies suggest that the stocks have become cheap enough to attract potential acquirers, and possibly bottom, according to Cramer.
“It’s very hard to figure out where this group might bottom because so many of them are unprofitable, but the fact that private equity’s gotten very interested definitely means something,” Cramer said.
Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.