The migration of data, video, music and other information to the cloud for safe storage and retrieval is becoming ubiquitous. While the process was slow and more difficult at first, it is now becoming simple for even the least tech savvy consumer to purchase and use the cloud for everything from home entertainment to small business needs. The software analysts at Cowen and Co. recently released results from their semi-annual Information Technology (IT)/ Offshore Spending survey. While current cloud revenues vary widely across their stocks to buy, they believe all are well positioned for growth.

Here are the top cloud software stocks to buy at Cowen.

Citrix Systems Inc. (NASDAQ: CTXS) is the top stock to buy for the second half of 2013. The analysts think it can beat easy comparisons, meet or beat management’s stated 14% to 15% revenues guidance and go from a current 5% discount to the peer group back to a premium. The company’s CloudStack was very popular with survey respondents. The Cowen price target for this top pick is $85. The Thomson/First Call estimate is at $78.

VMware Inc. (NYSE: VMW) continues to fight its way back from a brutal bout of selling. Majority owned by storage giant EMC Corp. (NYSE: EMC), the company was a pioneer in cloud computing software. Some 40% of the Cowen respondents expect to use VMW’s hybrid cloud, which bodes well for the its ability to not only retain customers but also extend the revenue opportunity. Cowen continues to believe this new service will appeal particularly to existing vSphere customers looking to take advantage of the compute elasticity that a hybrid cloud can provide, without having to make any changes to their applications. Cowen has set a $85 target for the stock, and the consensus is at $85 as well.

Microsoft Corp. (NASDAQ: MSFT) may seem like a surprise stock to buy for investors in this category. Most people are familiar with the popular Windows operating system software for computers. A very healthy 64% of all survey respondents expect to use Microsoft’s Azure platform as a public/hybrid cloud over the next 12 to 18 months. This data signals further good momentum for the service, which recently announced a $1 billion revenue run rate. The Cowen price target for the iconic company is $41. The consensus for the stock is at $35. Investors are paid a 2.7% dividend.

Red Hat Inc. (NYSE: RHT) is only rated at Market Perform, but it showed up strong in the Cowen survey. The company scored well with 32% intending to use RDO (RedHat Distribution of OpenStack). However, analysts note that RDO is a free edition of OpenStack and should not be confused with the company’s Enterprise Linux OpenStack Platform. Cowen has a $53 price target for the stock, while the consensus target is higher at $58.

Amazon.com Inc.‘s (NASDAQ: AMZN) AWS platform came in fourth place, selected by a lower-than-expected 38% of respondents. Cowen noted the adoption of AWS in this survey was more skewed to smaller companies, perhaps a reflection that its low-cost commodity-like offerings resonate somewhat less with very large information technology buyers. Although it was rated as a stock to buy at Cowen, no price target was posted. The consensus target for this top name is at $320.

Note that Jefferies just issued a different list of cloud and data center stocks to buy for the explosion of big data.

Cloud computing and storage is making its way into every major business sector here and around the world. From financial services to manufacturing to the oil and gas business, any firm that has large amounts of data to store, replicate, duplicate and access is moving to the cloud. Investors looking for a strong growth area of the sector should look to the cloud.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.