Software stocks have rallied sharply this year as investors bet on asset-light, high-growth companies that will see demand hold up through the current pandemic. However, valuations in the sector appear quite rich, even after the recent corrections. In our indicative theme of High Growth Software Stocks At A Fair Price we’ve picked a theme of software stocks that have seen good historical growth and yet are trading at relatively attractive valuations. The theme has returned about 19% year-to-date, versus 3.4% for the S&P 500. It remains up 65% Since 12/31/2017 vs. 25% for the S&P. Alarm.com Holdings (NASDAQ: ALRM) up 30% year-to-date has been the biggest driver of the theme’s returns. On the other side, RealPage’s (NASDAQ: RP) performance has been more muted, with the stock gaining about 4% this year. Below is a bit more about the companies in our theme.
Alarm.com Holdings provides cloud-based services for remote control,