Big Software Stocks Sell Off on AI Fears -- Wedbush Calls 'Buying Opportunity'

SelfRugger · 2026-04-04T18:31:17+00:00

Recent sell-offs in big software stocks due to AI concerns have led analysts, like Wedbush's Daniel Ives, to label this as a buying opportunity. While fears persist about AI replacing traditional software models, Ives believes AI will instead enhance current platforms, making this market dip an attractive investment chance.

SelfRugger

2026-04-04 18:31:17

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Big Software Stocks Sell Off on AI Fears – Wedbush Calls ‘Buying Opportunity’

Nauman Khan

Mon, February 16, 2026 at 8:15 PM GMT+9 1 min read

In this article:

                                      StockStory Top Pick

MSFT

-0.13%

NOW

+3.67%

 CRM  

 +2.31%

This article first appeared on GuruFocus.

Software stocks slid sharply amid fresh AI worries, drawing renewed attention from Wall Street analysts, including Wedbush Securities’ Daniel Ives.

Ives described the recent pullback in large-cap software as the most severe he has seen in decades, pointing to investor concern that rapid advances in artificial intelligence could weaken traditional enterprise software models.

Shares of ServiceNow (NYSE:NOW) climbed about four percent in friday trading, while Salesforce (NYSE:CRM) gained roughly two percent. Microsoft (NASDAQ:MSFT) edged lower by less than one percent.

Warning! GuruFocus has detected 2 Warning Sign with MSFT.

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The selloff earlier this year erased tens of billions of dollars in market value from major software firms. Since January, ServiceNow has fallen about 30%, Salesforce has dropped close to 28%, and Microsoft has declined roughly 17%, based on recent prices.

Ives said investors appear to assume AI tools will replace existing enterprise platforms. He argued instead that AI is likely to integrate into current software, supporting demand rather than eliminating it.

Salesforce now trades at a forward price-to-earnings multiple near 16 times, well below the broader software sector, despite reporting strong growth in its data cloud business and rising AI-related.

The AI headline risk may be scaring investors into an overreaction, for many high-quality enterprise software names, this pullback looks like a chance to buy quality at discounted prices.

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