The software industry is expected to grow rapidly in the upcoming year, driven by the remote and hybrid working environment and increased tech integration across various industries. Thus, quality stocks Oracle (ORCL) and VMware (NYSE:VMW) could deliver substantial gains. However, as the markets are extremely volatile, fundamentally weak software stocks OKTA (OKTA) and ZoomInfo Technologies (ZI) are best avoided now.The software industry has been in the limelight since the onset of the COVID-19 pandemic, owing to its critical role in navigating the remote and hybrid working lifestyle. Many companies have used this opportunity to expand their products and services.
As the hybrid working lifestyle is expected to continue in the near term, with rising concerns surrounding the omicron coronavirus variant, fundamentally sound software stocks Oracle Corporation (NYSE:ORCL) and VMware, Inc. (VMW) could be solid bets now.
However, the ongoing chip shortage and increased cyberattacks have caused the weak players in the software industry to witness a sharp pullback. As the markets continue to reverse with major benchmark indexes slumping, fundamentally weak software stocks OKTA, Inc. (OKTA) and ZoomInfo Technologies Inc. (ZI) are best avoided now.