Top Bank Names 3 Software Stocks Its Top Picks for 2026
BMO Capital Markets added Dynatrace (DT) and ServiceNow (NOW) to its top software picks for 2026, maintaining Outperform ratings and raising price targets for both. Okta (OKTA) was also included, with the analyst noting higher expectations ahead of its earnings. ServiceNow's performance obligations are expected to grow 20% YoY in Q3, with organic growth potentially reaching 20%.
How this was made
The 30-second read
Why it matters
Analyst upgrades with higher price targets can drive short‑term buying pressure, especially for DT and NOW.
Market read
The upgrades may lift DT and NOW shares, while OKTA sees limited impact.
What to watch
Potential macro‑risk from higher interest rates could dampen software valuations.
Background
BMO Capital Markets refreshed its 2026 software stock picks, adding Dynatrace and ServiceNow alongside Okta.
Ticker impact
BMO raised the price target for Dynatrace and kept an Outperform rating.
likely upward pressure as investors price in the higher target
Target raise is a fresh catalyst and the analyst kept a bullish rating.
BMO raised the price target for ServiceNow and kept an Outperform rating.
likely upward pressure as the market absorbs the upgraded outlook
Target raise is a new positive signal from a reputable sell‑side house.
BMO kept an Outperform rating on Okta but did not raise the price target.
limited movement, potential modest support from the Outperform rating
Rating unchanged and no target lift means less catalyst strength.
Market effects
Highlights continued optimism in the enterprise software sector.
U.S. tech equities may see modest gains from the upgrades.
Limited to investors tracking software stocks globally.
Counterpoint
The upgrades may be premature if upcoming earnings miss expectations.
Key entities
- analystBMO Capital Markets
Provides research coverage and price target updates.
- companyDynatrace
Software performance monitoring firm.
- companyServiceNow
Enterprise cloud workflow platform.
- companyOkta
Identity and access management provider.
