10 Worst Performing Software Stocks to Buy According to Analysts

8. SPS Commerce Inc. (NASDAQ:SPSC)

YTD returns: -28%

Potential Upside: 50%

Number of Hedge Fund Holders: 29

SPS Commerce Inc. (NASDAQ:SPSC) provides on-demand supply chain management solutions through an online hosted software suite. Eliminating the need for complex on-premise software, SPS Commerce’s online platform works smoothly with retail customers’ existing systems and makes it easier to track shipments, manage stock levels, and process orders without needing extra IT staff or expensive equipment.

SPS Commerce Inc. (NASDAQ:SPSC)’s share price performance in 2024 was lackluster as it fell 5% that year. The weak momentum spilled into 2025 as well and by February 10 the stock was down 4%. On February 10, the company announced its Q4 2024 results which were received with a negative response and subsequently the shares tanked 14% on February 11, leading to a YTD decline of 28%.

The primary reason for the decline was the company’s exposure to supply chain management, potential tariff and policy changes could have an impact on its growth trajectory and thus investors appear jittery, leading to share price volatility. Otherwise, SPS Commerce Inc. (NASDAQ:SPSC)’s quarterly results were healthy with 19% YoY revenue growth, and revenue and EPS both moderately above street expectations. Moreover, guidance was not bad either with revenue growth projected at 19%-20% in 2025.

After the results, analyst responses were mixed on the stock. Craig-Hallum analyst Anthony Stoss reaffirmed his Buy rating with a price target of $220, whereas Baird analyst Joe Vruwink lowered his price target to $175 from $188 and reiterated his Neutral rating. Consensus still appears optimistic with an average price target of $200, reflecting a 50% potential upside.