7 Cheap Software Stocks to Invest In

2. GigaCloud Technology (NASDAQ:GCT)  

Forward P/E Ratio as of October 3: 9.08  

Upside Potential: 64.38%

Number of Hedge Fund Holders: 5

GigaCloud Technology (NASDAQ:GCT) runs Giga B2B, a business-to-business (B2B) e-commerce platform specializing in the logistics and distribution of large parcel merchandise, such as furniture, exercise equipment, and home appliances. The company connects global buyers with manufacturers in international markets.

The global B2B e-commerce market is expected to grow by 22.5% CAGR between 2023-2030. Digital channels are expected to contribute 56% of revenue by 2025. This increases the potential market and customer base for B2B e-commerce platforms such as Giga B2B.

In Q2, GigaCloud Technology (NASDAQ:GCT) reported a revenue of $310.87 million, a 103% increase compared to the previous year. However, the company’s earnings per share (EPS) growth has been slower, which has led to a decline in the stock price. Despite this, the company’s management believes the stock is attractively valued and has announced a $46 million share buyback program. The company is expected to increase its revenue by 58% YoY in Q3.

GigaCloud Technology’s (NASDAQ:GCT) stock is trading at a forward PE of 9.08, a 61% discount to its sector median of 17.06. Analysts expect the company to increase its earnings by 20.11% this year and have a consensus on the stock’s Buy rating, setting an average share price target at $51.37, which represents a 64.38% upside potential from its current level.

As of the second quarter, the stock is held by 5 hedge funds, and the stakes amount to $14.68 million.