10 Hot Software Stocks with High Upside Potential

7) Porch Group, Inc. (NASDAQ:PRCH)

% Gain Over Past 6 Months: ~253.6%

Average Upside Potential: ~45.5%

Number of Hedge Fund Holders: 7

Porch Group, Inc. (NASDAQ:PRCH) operates a vertical software and insurance platform in the US. Craig-Hallum is confident in the company’s potential, which stems from its strategic changes, mainly the transformation of its insurance business into a reciprocal structure. On January 7, the company announced the completed formation of the Porch Insurance Reciprocal Exchange (PIRE) and the sale of Homeowners of America Insurance Company to PIRE.

With the transaction now complete, all the insurance policies, premiums, related claims, and all the HOA assets and liabilities will be owned by PIRE. Porch Group, Inc. (NASDAQ:PRCH) will receive commissions and fees for providing operating and other services to PIRE, which can deliver more predictable and higher-margin financial results for Porch Group, Inc. (NASDAQ:PRCH)’s shareholders. Craig-Hallum opines that the housing market is expected to recover its momentum into 2025, which can result in significant expansion for Porch Group, Inc. (NASDAQ:PRCH)’s software and data business.

Notably, with businesses digitizing their operations, the company’s software solutions for home inspectors, movers, and contractors are expected to witness higher adoption. Also, with the growth in the software industry, Porch Group, Inc. (NASDAQ:PRCH) will benefit through platform scaling, expansion of customer base, and improvement in operational efficiency.