The software trade has seen a significant repricing, with the AI sector experiencing anxiety among investors. UBS analyst Andrew Garthwaite notes that the software sector is currently oversold, presenting a potential buying opportunity for fundamentally strong U.S.-based companies like Microsoft, Autodesk, and HubSpot, which have all seen YTD losses but remain resilient. Microsoft, with a market cap of $2.85 trillion, offers a stable dividend, but faces challenges in the near term. Autodesk, valued at $46.4 billion, has solid fundamentals but has also seen a decline in its stock price. HubSpot, valued at $11.5 billion, has shown strong performance despite recent stock setbacks.

Microsoft, with a forward adjusted earnings multiple of 23.8x, reported strong Q2 fiscal 2026 results, with revenue up 17% YOY to $81.3 billion and non-GAAP EPS up 24%. Despite this, the stock is down about 20% YTD. Analysts expect continued growth for Microsoft, with an average price target of $595.60 suggesting a 53.8% upside potential. Autodesk, trading at 27x forward adjusted earnings, reported Q3 fiscal 2026 results that exceeded expectations, with revenue up 18% YOY to $1.9 billion. The stock has fallen about 22.4% over the past 52 weeks. Analysts have a price target of $366.31 for Autodesk, indicating a 66.3% upside potential. HubSpot, trading at 17.46x forward adjusted earnings, recently reported strong Q4 and full-year 2025 results, with revenue up 20.4% YOY to $846.7 million. The stock is down 42.17% YTD, but analysts have a price target of $376.03, suggesting a 61.6% upside potential.

Read more at Barchart: 3 Cheap Software Stocks to Buy on the Dip Now