Software Stocks Are Dominating the AI Cycle: SAP, ServiceNow, Oracle, and Globex Mining Are in Higher Demand Than Ever!

SAP: AI Push and Major Contracts from Germany Provide a Boost

SAP is currently experiencing a remarkable stock market revaluation. Following a significant correction down to EUR 135 in May, the stock has gained more than 25% in just a few weeks. The Walldorf-based group is benefiting from the improved sentiment in the technology and AI sectors. Analysts are wondering why the sell-off fell so sharply in the first place. They continue to expect revenue growth of 9 to 10% and revenues of over EUR 40 billion in the coming years, while AI integration is expected to unlock increasing margin potential.

Of particular interest is the company's role in building a German AI cloud for public administration. The project involves investments of around EUR 250 million, with approximately 70% of the funds allocated to SAP and the Telekom Group. As early as 2025, SAP received around EUR 181 million from the federal government for licenses and services. For investors, the key factor is this: the enormous existing customer base offers ideal conditions for marketing new AI features via usage-based pricing models. Despite the recent strong recovery, analysts on the LSEG platform see further potential, and some value the stock at over EUR 218, nearly 30% above yesterday's close. If the AI strategy is successfully monetized, SAP is likely to further solidify its position as a leading European software and infrastructure group. We had already recommended entering the position at EUR 150; now it is time to steadily increase holdings in the portfolio up to the target level.

Oracle: Computing Power Galore

Two months ago, we first noticed Oracle's sell-off prices. At the time, many analysts were concerned about the software group's high investments and rising debt. Now, the stock has risen by 60% since mid-April. With prices around USD 242, the share has already gained USD 110 since its lows. The rally is driven by a fundamental revaluation of the cloud and AI business, which is increasingly establishing the company as a serious infrastructure provider for AI applications. The market sees Oracle as a growing competitor to the established hyperscalers, supported by repeatedly raised growth forecasts in the cloud sector and record order backlogs. One thing is becoming increasingly clear: CEO Larry Ellison made these investments with wise foresight for strong future growth. With his vastly increased computing and network capacity, he will once again deliver operational surprises. However, the stock has surged close to LSEG analysts' price targets of around USD 252 in just a short time. It is difficult to imagine it breaking through immediately from here.

ServiceNow: The AI Control Center Between SAP and Oracle

While SAP primarily manages companies' core business processes and Oracle leverages its strengths in databases, cloud infrastructure, and enterprise applications, ServiceNow focuses on workflow automation. The platform digitizes and orchestrates processes in IT, human resources, customer service, procurement, and compliance, significantly reducing manual tasks. The business model is particularly attractive because, after implementation, customers often gradually expand their use to other areas of the company, generating high recurring revenue. With the integration of generative AI, ServiceNow is increasingly evolving into a kind of digital control center that analyzes requests, prepares decisions, and autonomously initiates processes. Unlike SAP and Oracle, ServiceNow operates directly at the operational process level. This makes the company a major beneficiary of the AI trend, as efficiency gains and automation create immediately measurable cost advantages for many customers. The stock fell to as low as USD 82 during the software sell-off and reached a high of USD 136 yesterday. The price is now not far from the LSEG 12-month consensus price target of USD 144! That happened fast.

Globex Mining: Without a Supply of Critical Metals, the AI boom Will Fail

The global race for artificial intelligence is usually reduced to software, data centers, and semiconductors. In reality, however, the value chain begins much earlier—namely in mining. High-performance processors, power grids, and data centers require enormous quantities of iron, copper, nickel, antimony, rare earths, and other strategic raw materials. Without a reliable supply of these critical metals, the trillion-dollar AI expansion risks failing due to a bottleneck.

Globex Mining has a business model ready to capitalize on this opportunity. Over decades, the company has built a broadly diversified raw materials portfolio that now encompasses more than 260 projects as well as over 100 licenses and participation rights. Instead of relying on a single deposit, Globex spreads risk across numerous raw materials, regions, and stages of development. Its financial strength is worth noting. The company operates debt-free and holds cash and securities totalling approximately CAD 35-40 million. Based on the approximately 57 million outstanding shares, this translates to a substantial net asset value per share. Ongoing exploration work increases the likelihood of additional royalty income and strengthens Globex's position in the field of strategic metals of the future.

COO David Christie discussed the unique advantages of his commodity asset business at the recent International Investment Forum.

https://youtu.be/EW22N6jb9W4

Furthermore, the project generator model can generate significant leverage during a commodities supercycle. Under the long-standing leadership of founder and CEO Jack Stoch, a commodities platform has been created that has continuously built up assets over decades. Most recently, a new 1% gross metal royalty on the Mont-Sorcier iron project in Québec was announced. A bankable feasibility study is currently being prepared there, with publication expected in the second quarter of 2026. The project is expected to produce up to 8 million tons of high-grade iron ore concentrate per year in the long term, up from the 5 million tons assumed in earlier plans. Earlier economic analyses had already estimated the project's value at around USD 1.6 billion, meaning that even a relatively small royalty stake could unlock significant potential. At the Salt Spring Gold Project in Arizona, Globex recently identified several promising gold zones with outstanding individual samples. Such announcements are not one-offs, but a constant stream from the Canadians' massive portfolio. Buy!

The capital markets are gearing up for the largest IPO of all time. Elon Musk's SpaceX aims to raise a solid USD 80 billion in growth capital over the next few days. Only 4% of the outstanding shares are expected to be offered for trading. For the tech sector, this is likely to trigger some rotations; for critical metals, it is the next boost in the rally toward higher valuations! The Trend is your Friend!