10 Hot Software Stocks with High Upside Potential

6) Similarweb Ltd. (NYSE:SMWB)

% Gain Over Past 6 Months: ~32.6%

Average Upside Potential: ~48.7%

Number of Hedge Fund Holders: 19

Similarweb Ltd. (NYSE:SMWB) is engaged in providing cloud-based digital intelligence solutions in the United States, Europe, the Asia Pacific, the United Kingdom, Israel, and internationally. Citi upped the price target on the company’s stock to $22 from $14, keeping a “Buy” rating as part of a December quarter preview associated with the front-office application software group. Citi remains optimistic for front-office software budgets in 2025 in comparison to 2024 as sentiments have been improved among ecosystem partners post the US elections.

Similarweb Ltd. (NYSE:SMWB) released its financial results for Q4 ended December 31, 2024. The company’s focus on disciplined execution led to the first full year of non-GAAP operating profit and FCF, showcasing the company’s ability to accelerate growth while generating profit. Jefferies analyst Surinder Thind believes that demand from AI companies remains an incremental near-term tailwind. In 2024, customers started to train LLMs with Similarweb Ltd. (NYSE:SMWB)’s data, and the company is extensively engaging with brands focused on leveraging its unique data to understand the evolving digital world.

In a bid to capitalize on the opportunity, Similarweb Ltd. (NYSE:SMWB) decided to increase its investment in sales and R&D for 2025. For the year, the company expects to post a non-GAAP operating profit of between $1.0 million – $4.0 million.