Let's go with 'collapse' for the group we pegged as the FAANG replacement* back at the end of November.
From Investor's Business Daily:
3:16 PM ET
A two-month rally in enterprise software and cybersecurity stocks gave way to profit-taking on Monday when shares in Salesforce.com (CRM), Workday (WDAY), Twilio (TWLO), Atlassian (TEAM), Splunk (SPLK), and a slew of other companies took a hit.Salesforce is now down $6.24 (-3.79%) at $158.29
Both the IBD Computer-Software Enterprise and Computer-Software Security groups had their worst day since Jan. 3. Both groups bottomed on Dec. 24 amid a broad sell-off in technology stocks.
Shares in enterprise software and cybersecurity stocks weakened in September and October, predating the correction in technology stocks that followed in late 2018.
Rather than being a precursor to another technology downturn, Monday's sell-off in enterprise software and cybersecurity stocks could simply be profit-taking. Many stocks popped recently on better-than-expected earnings.
While some analysts have turned cautious on valuation, stock downgrades in the software sectors have been few following the run-ups. Richard Davis, a software analyst at Canaccord Genuity, told IBD that company valuations had rebounded nearly back to all-time highs.
"Fundamentals are good, valuations were a stretch, nothing more, nothing less," he said in an email.
Salesforce Falls Before Earnings
Shares in Salesforce dropped 4.6% to 156.96 in midday trading on the stock market today. Salesforce earnings are due late Monday....MORE
*Following The Salesforce Earnings Tour de Force: "Workday, VMware Signal Breakouts On Strong Earnings (CRM; VMW; WDAY)
Software and cloud seems to be the new FAANG....
Workday has fallen to its 50-day moving average:
