10 Best Horizontal Saas for February 2026
Welcome to the Value Sense Blog, your resource for insights on the stock market! At Value Sense, we focus on intrinsic value tools and offer stock ideas with undervalued companies. Dive into our research products and learn more about our unique approach at valuesense.io
Explore diverse stock ideas covering technology, healthcare, and commodities sectors. Our insights are crafted to help investors spot opportunities in undervalued growth stocks, enhancing potential returns. Visit us to see evaluations and in-depth market research.
Market Overview & Selection Criteria
In the current market environment as of early 2026, value investors face opportunities amid sector rotations toward technology, utilities, and high-growth software firms. Value Sense's automated fundamental analysis platform identifies undervalued stocks by comparing current market prices to calculated intrinsic values, prioritizing high Quality ratings, strong ROIC, positive Free Cash Flow, and revenue growth potential. These 10 stocks were selected from Value Sense data for their potential undervaluation, blending stable utilities with innovative tech plays across SaaS, data storage, and digital infrastructure. Selection emphasizes companies with robust margins and growth trajectories, ideal for long-term watchlists targeting "best value stocks" and "undervalued stocks to buy."
Featured Stock Analysis
Stock #1: CMS Energy Corporation (CMS)
| Metric | Value |
|---|---|
| Market Cap | $21.1B |
| Quality Rating | 5.9 |
| Intrinsic Value | $51.3 |
| 1Y Return | 8.8% |
| Revenue | $8,295.0M |
| Free Cash Flow | $1,032.0M |
| Revenue Growth | 11.0% |
| FCF margin | 12.4% |
| Gross margin | 31.8% |
| ROIC | 10.4% |
| Total Debt to Equity | (51.7%) |
Investment Thesis
CMS Energy Corporation (CMS), a utilities provider, stands out with a Quality rating of 5.9 and an intrinsic value of $51.3, suggesting undervaluation for value-focused analysis. The company reports a solid Market Cap of $21.1B, Revenue of $8,295.0M with 11.0% growth, and Free Cash Flow of $1,032.0M at a healthy 12.4% FCF margin. Its Gross margin of 31.8% and ROIC of 10.4% reflect efficient operations in the stable energy sector, while a low Total Debt to Equity of 51.7% indicates prudent leverage. Despite a modest 8.8% 1Y Return, these metrics position CMS as a defensive pick in portfolios seeking consistent cash flows amid economic uncertainty.
This analysis highlights CMS's role in diversified watchlists, offering reliability compared to higher-volatility tech peers like those in SaaS.
Key Catalysts
- Strong revenue growth at 11.0%, signaling expanding operations in energy distribution.
- Positive Free Cash Flow of $1,032.0M supports dividends and reinvestment.
- Efficient ROIC of 10.4% demonstrates capital allocation strength.
- Stable Gross margin of 31.8% in a regulated sector.
Risk Factors
- Modest Quality rating of 5.9 may limit upside in high-growth scenarios.
- Sector sensitivity to interest rate changes affecting utilities.
- Limited 1Y Return of 8.8% trails broader market benchmarks.
Stock #2: NetApp, Inc. (NTAP)
| Metric | Value |
|---|---|
| Market Cap | $19.5B |
| Quality Rating | 6.9 |
| Intrinsic Value | $133.9 |
| 1Y Return | -21.3% |
| Revenue | $6,635.0M |
| Free Cash Flow | $1,598.0M |
| Revenue Growth | 2.5% |
| FCF margin | 24.1% |
| Gross margin | 70.3% |
| ROIC | 29.8% |
| Total Debt to Equity | 252.1% |
Investment Thesis
NetApp, Inc. (NTAP), a data storage leader, features a strong Quality rating of 6.9 and intrinsic value of $133.9, indicating significant undervaluation potential. With a Market Cap of $19.5B, Revenue reaches $6,635.0M (2.5% growth), bolstered by exceptional Free Cash Flow of $1,598.0M and 24.1% FCF margin. High Gross margin of 70.3% and top-tier ROIC of 29.8% underscore operational excellence, though Total Debt to Equity at 252.1% warrants monitoring. The -21.3% 1Y Return presents a contrarian entry for tech sector recovery analysis.
NTAP complements growth-oriented picks like HUBS by offering mature infrastructure plays in the expanding data economy.
Key Catalysts
- Outstanding ROIC of 29.8% highlights superior returns on capital.
- Robust FCF margin of 24.1% with $1,598.0M cash generation.
- High Gross margin of 70.3% from premium storage solutions.
- Steady revenue base in cloud data management.
Risk Factors
- Elevated Total Debt to Equity of 252.1% increases financial risk.
- Negative 1Y Return of -21.3% reflects market volatility.
- Modest revenue growth of 2.5% trails high-growth peers.
Stock #3: CGI Inc. (GIB)
| Metric | Value |
|---|---|
| Market Cap | $18.5B |
| Quality Rating | 7.0 |
| Intrinsic Value | $149.3 |
| 1Y Return | -27.8% |
| Revenue | CA$16.2B |
| Free Cash Flow | CA$2,258.9M |
| Revenue Growth | 8.9% |
| FCF margin | 14.0% |
| Gross margin | 20.5% |
| ROIC | 17.9% |
| Total Debt to Equity | 48.4% |
Investment Thesis
CGI Inc. (GIB), an IT services firm, earns a leading Quality rating of 7.0 with intrinsic value at $149.3, positioning it as a top undervalued pick. Market Cap of $18.5B supports Revenue of CA$16.2B (8.9% growth) and Free Cash Flow of CA$2,258.9M at 14.0% FCF margin. ROIC of 17.9% and manageable Total Debt to Equity of 48.4% reflect balanced growth, despite a -27.8% 1Y Return offering rebound potential in enterprise tech.
GIB's stability pairs well with volatile innovators like CFLT for diversified tech exposure.
Key Catalysts
- Highest Quality rating of 7.0 among peers.
- Strong Revenue growth of 8.9% in IT consulting.
- Solid Free Cash Flow of CA$2,258.9M.
- Efficient ROIC of 17.9%.
Risk Factors
- Negative 1Y Return of -27.8% signals short-term pressure.
- Currency exposure with CA$-denominated metrics.
- Lower Gross margin of 20.5% vs. software pure-plays.
Stock #4: HubSpot, Inc. (HUBS)
| Metric | Value |
|---|---|
| Market Cap | $14.9B |
| Quality Rating | 6.1 |
| Intrinsic Value | $168.3 |
| 1Y Return | -63.7% |
| Revenue | $2,987.7M |
| Free Cash Flow | $655.0M |
| Revenue Growth | 19.2% |
| FCF margin | 21.9% |
| Gross margin | 84.1% |
| ROIC | (6.0%) |
| Total Debt to Equity | 14.7% |
Investment Thesis
HubSpot, Inc. (HUBS), a marketing software provider, shows a Quality rating of 6.1 and intrinsic value of $168.3 amid high growth. Market Cap of $14.9B backs Revenue of $2,987.7M (19.2% growth) and Free Cash Flow of $655.0M (21.9% margin). Exceptional Gross margin of 84.1% shines, though negative ROIC of 6.0% and low Total Debt to Equity of 14.7% highlight investment phase. Steep -63.7% 1Y Return suggests deep value for SaaS recovery.
HUBS aligns with GDDY for CRM and marketing tech synergy.
Key Catalysts
- Rapid Revenue growth of 19.2%.
- Elite Gross margin of 84.1%.
- Improving FCF margin of 21.9%.
- Low debt at 14.7% supports scaling.
Risk Factors
- Negative ROIC of 6.0% indicates capital inefficiency.
- Sharp 1Y Return decline of -63.7%.
- Growth stock volatility in economic slowdowns.
Stock #5: GoDaddy Inc. (GDDY)
| Metric | Value |
|---|---|
| Market Cap | $13.6B |
| Quality Rating | 7.0 |
| Intrinsic Value | $183.0 |
| 1Y Return | -52.9% |
| Revenue | $4,869.8M |
| Free Cash Flow | $1,537.9M |
| Revenue Growth | 8.8% |
| FCF margin | 31.6% |
| Gross margin | 61.5% |
| ROIC | 19.4% |
| Total Debt to Equity | 4,193.5% |
Investment Thesis
GoDaddy Inc. (GDDY), a web services platform, matches top Quality rating of 7.0 with intrinsic value of $183.0. Market Cap of $13.6B drives Revenue of $4,869.8M (8.8% growth) and standout Free Cash Flow of $1,537.9M (31.6% margin). Strong ROIC of 19.4% and Gross margin of 61.5% excel, despite extreme Total Debt to Equity of 4,193.5%. -52.9% 1Y Return flags entry for domain and hosting demand.
GDDY bolsters digital economy themes with PCTY.
Key Catalysts
- Peak Quality rating of 7.0.
- Highest FCF margin of 31.6%.
- Solid ROIC of 19.4%.
- Consistent Revenue growth of 8.8%.
Risk Factors
- Massive Total Debt to Equity of 4,193.5%.
- Significant 1Y Return drop of -52.9%.
- Competition in web hosting space.
Most investors waste time on the wrong metrics. We've spent 10,000+ hours perfecting our value investing engine to find what actually matters.
Want to see what we'll uncover next - before everyone else does?
Find Hidden Gems First!
Stock #6: Confluent, Inc. (CFLT)
| Metric | Value |
|---|---|
| Market Cap | $10.6B |
| Quality Rating | 5.0 |
| Intrinsic Value | $28.7 |
| 1Y Return | 3.5% |
| Revenue | $1,113.1M |
| Free Cash Flow | $53.5M |
| Revenue Growth | 21.6% |
| FCF margin | 4.8% |
| Gross margin | 74.1% |
| ROIC | (62.7%) |
| Total Debt to Equity | 98.9% |
Investment Thesis
Confluent, Inc. (CFLT), a data streaming specialist, has a Quality rating of 5.0 and intrinsic value of $28.7. Market Cap of $10.6B supports Revenue of $1,113.1M (21.6% growth), with modest Free Cash Flow of $53.5M (4.8% margin). High Gross margin of 74.1% aids scalability, but negative ROIC of 62.7% and Total Debt to Equity of 98.9% reflect early-stage risks. Positive 3.5% 1Y Return bucks trends.
CFLT fits high-growth data plays alongside NTAP.
Key Catalysts
- Accelerating Revenue growth of 21.6%.
- Strong Gross margin of 74.1%.
- Emerging positive Free Cash Flow.
- Data infrastructure tailwinds.
Risk Factors
- Low Quality rating of 5.0.
- Poor ROIC of 62.7%.
- High Total Debt to Equity of 98.9%.
Stock #7: Applied Digital Corporation (APLD)
| Metric | Value |
|---|---|
| Market Cap | $9,480.3M |
| Quality Rating | 6.2 |
| Intrinsic Value | $1.1 |
| 1Y Return | 359.1% |
| Revenue | $281.7M |
| Free Cash Flow | ($1,144.1M) |
| Revenue Growth | 33.1% |
| FCF margin | (406.1%) |
| Gross margin | 16.4% |
| ROIC | (5.7%) |
| Total Debt to Equity | 125.9% |
Investment Thesis
Applied Digital Corporation (APLD), in digital infrastructure, scores Quality rating 6.2 with intrinsic value of $1.1. Market Cap of $9,480.3M pairs with Revenue of $281.7M (33.1% growth), but negative Free Cash Flow of $1,144.1M and 406.1% margin highlight burn. Low Gross margin of 16.4%, ROIC 5.7%, and Total Debt to Equity 125.9% show risks, offset by explosive 359.1% 1Y Return.
APLD adds high-volatility growth to balanced lists.
Key Catalysts
- Exceptional 1Y Return of 359.1%.
- Robust Revenue growth of 33.1%.
- Digital/AI infrastructure demand.
- Improving scale potential.
Risk Factors
- Negative Free Cash Flow of $1,144.1M.
- Poor FCF margin of 406.1%.
- Negative ROIC of 5.7%.
Stock #8: Aurora Innovation, Inc. (AUR)
| Metric | Value |
|---|---|
| Market Cap | $8,131.3M |
| Quality Rating | 5.2 |
| Intrinsic Value | $0.7 |
| 1Y Return | -38.3% |
| Revenue | $2,000.0K |
| Free Cash Flow | ($608.0M) |
| Revenue Growth | N/A |
| FCF margin | (30,400.0%) |
| Gross margin | (1,700.0%) |
| ROIC | (103.8%) |
| Total Debt to Equity | 8.8% |
Investment Thesis
Aurora Innovation, Inc. (AUR), an autonomous vehicle developer, has Quality rating 5.2 and low intrinsic value of $0.7. Market Cap $8,131.3M with minimal Revenue $2,000.0K, heavy losses in Free Cash Flow $608.0M, 30,400.0% margin, Gross margin 1,700.0%, and ROIC 103.8%. Low Total Debt to Equity 8.8%; -38.3% 1Y Return reflects pre-revenue challenges.
AUR suits speculative tech diversification.
Key Catalysts
- Autonomous driving market growth.
- Low Total Debt to Equity of 8.8%.
- Potential revenue ramp-up.
- Strategic partnerships in AV.
Risk Factors
- Severe negative ROIC of 103.8%.
- Tiny Revenue $2,000.0K.
- Extreme FCF margin 30,400.0%.
Stock #9: Paylocity Holding Corporation (PCTY)
| Metric | Value |
|---|---|
| Market Cap | $7,332.3M |
| Quality Rating | 6.7 |
| Intrinsic Value | $139.5 |
| 1Y Return | -33.0% |
| Revenue | $1,640.4M |
| Free Cash Flow | $381.8M |
| Revenue Growth | 13.3% |
| FCF margin | 23.3% |
| Gross margin | 68.8% |
| ROIC | 36.3% |
| Total Debt to Equity | 11.6% |
Investment Thesis
Paylocity Holding Corporation (PCTY), a payroll software firm, boasts Quality rating 6.7 and intrinsic value $139.5. Market Cap $7,332.3M with Revenue $1,640.4M (13.3% growth), Free Cash Flow $381.8M (23.3% margin), Gross margin 68.8%, elite ROIC 36.3%, low Total Debt to Equity 11.6%. -33.0% 1Y Return offers HCM sector value.
PCTY enhances SaaS cluster with GDDY, HUBS.
Key Catalysts
- Top ROIC of 36.3%.
- Healthy Revenue growth 13.3%.
- Strong FCF margin 23.3%.
- Low debt profile.
Risk Factors
- Negative 1Y Return -33.0%.
- Competition in HR tech.
- Growth moderation risks.
Stock #10: ServiceTitan, Inc. (TTAN)
| Metric | Value |
|---|---|
| Market Cap | $7,235.2M |
| Quality Rating | 5.2 |
| Intrinsic Value | $14.0K |
| 1Y Return | -21.9% |
| Revenue | $707.2B |
| Free Cash Flow | $90.2B |
| Revenue Growth | 96,025.2% |
| FCF margin | 12.8% |
| Gross margin | 70.2% |
| ROIC | (11.3%) |
| Total Debt to Equity | 3.6% |
Investment Thesis
ServiceTitan, Inc. (TTAN), field service software, rates Quality 5.2 with extraordinary intrinsic value $14.0K. Massive Market Cap $7,235.2M, Revenue $707.2B (96,025.2% growth), Free Cash Flow $90.2B (12.8% margin), Gross margin 70.2%, negative ROIC 11.3%, low Total Debt to Equity 3.6%. -21.9% 1Y Return amid hyper-scale.
TTAN anchors high-growth SaaS with extreme metrics for analysis.
Key Catalysts
- Explosive Revenue growth 96,025.2%.
- Huge Free Cash Flow $90.2B.
- Solid Gross margin 70.2%.
- Minimal debt at 3.6%.
Risk Factors
- Negative ROIC 11.3%.
- Scale sustainability questions.
- 1Y Return -21.9%.
Portfolio Diversification Insights
These 10 stocks offer broad diversification: CMS provides utilities stability (energy sector), NTAP and GIB anchor mature tech/IT services, while HUBS, GDDY, CFLT, PCTY, and TTAN cluster in SaaS and software (60% allocation) for growth. APLD and AUR add speculative digital infrastructure and AV exposure. Sector balance mitigates risks—defensive CMS offsets volatile tech—targeting 20-30% per category for resilient watchlists. High Quality ratings (avg. 6.2) and varied ROIC create complementary profiles, enhancing "stock watchlist" potential.
Market Timing & Entry Strategies
Consider entry during tech sector dips, as many show negative 1Y Returns signaling rebounds; monitor intrinsic value gaps widening on pullbacks. Dollar-cost average into high-conviction picks like GIB/NTAP (strong ROIC), avoiding overexposure to negative FCF names like APLD/AUR. Track revenue growth catalysts quarterly; ideal for value investors using Value Sense screeners amid 2026 volatility.
Explore More Investment Opportunities
For investors seeking undervalued companies with high fundamental quality, our analytics team provides curated stock lists:
📌 50 Undervalued Stocks (Best overall value plays for 2025)
📌 50 Undervalued Dividend Stocks (For income-focused investors)
📌 50 Undervalued Growth Stocks (High-growth potential with strong fundamentals)
🔍 Check out these stocks on the Value Sense platform for free!
More Articles You Might Like
- Nelson Peltz - Trian Fund Management Portfolio Q3'2025: Top Holdings & Recent Changes
- Principles for Dealing with the Changing World Order by Ray Dalio
- The Ascent of Money by Niall Ferguson
- Principles for Navigating Big Debt Crises by Ray Dalio
- Influence: The Psychology of Persuasion by Robert B. Cialdini Ph.D.
FAQ Section
How were these stocks selected?
These stocks were chosen using Value Sense's methodology, focusing on intrinsic value comparisons, Quality ratings above 5.0, revenue growth, and ROIC for undervalued opportunities across sectors.
What's the best stock from this list?
CGI Inc. (GIB) and GoDaddy (GDDY) top with Quality rating 7.0, strong FCF margins, and high intrinsic values, ideal for balanced growth analysis.
Should I buy all these stocks or diversify?
Diversify across sectors like utilities (CMS) and SaaS (HUBS, TTAN) to manage risks; allocate based on ROIC and debt levels for optimal watchlist construction.
What are the biggest risks with these picks?
Key risks include high Total Debt to Equity (e.g., GDDY at 4,193.5%), negative ROIC in growth names (CFLT, AUR), and 1Y Return volatility.
When is the best time to invest in these stocks?
Target entries when prices dip below intrinsic values, especially post-earnings for growth stocks, using Value Sense tools for timing in volatile markets.