Some software stocks have gotten even cheaper

Despite an average rise of eight percent since the start of the year, many software company stocks are cheaper now than six months ago and one year ago, based on a group of one hundred and sixty-one software stocks out of a total universe of about five hundred and fifty U.S.-listed tech stocks.

The table below plots the change in one key measure for software stocks, their enterprise value divided by the next twelve months’ projected revenue according to FactSet consensus. Enterprise value is the total value of the company when you add up the shares outstanding and then subtract net cash, meaning, cash and equivalents and long-term investments, less long-term debt.