It was a nasty year for the software stocks in 2025, as investors pondered the disruptive impact of artificial intelligence (AI). With shares of enterprise software and AI agent innovator Salesforce (NYSE:CRM | CRM Price Prediction) and creative software titan Adobe (NASDAQ:ADBE) starting off the very first trading day of the year with a steep decline, it feels like all hope is lost for 2026, as the ailing software plays come in limping to kick off 2026.
While it’s not a great way to begin a new year, I do think that value investors might have a chance to get a bigger discount on their way down, especially if new AI innovations look to add to the fears of the software-as-a-service (SaaS) companies. Undoubtedly, there’s a lot of uncertainty regarding the names, but if AI disruption fears are overdone and the software juggernauts can effectively adopt AI and agents, I do see a scenario where the top players can turn a corner.
It’s never encouraging to start the year from behind
In any case, Salesforce and Adobe went into the year with pretty low expectations. And since the year began, expectations have been lowered even further, with Salesforce and Adobe shares down around 3.5% and 5.4%, respectively, year to date, at least at the time of this writing.
The big question moving forward is whether these software stocks can catch up after starting the year from behind. Just because the first year saw big losses doesn’t mean it’s time to dismiss 2026 as another year where they lose even more ground.
Though each firm will need to execute a great deal to win back the confidence of investors, I do think the risk/reward is getting very interesting at these levels. Let’s look into each name to see which may be the better bet for interested investors seeking AI growth at a historic discount. As always, buying the dip in stocks has lost its way is never easy, especially when you consider the disruptive impact of AI on a business. That said, the following names, I think, might be too cheap for their own good.
Salesforce
Enterprise software has been a tough place to be, but with some cutting-edge agentic AI tech under the hood and a potential wave of adoption that might be lying ahead, I think it’s too soon to give up on Salesforce. Like a handful of other high-tech innovators, Salesforce closed out 2025 with an acquisition announcement. The company inked a deal to buy up agentic AI marketing firm Qualified, which further adds to the power of Salesforce’s growing AI agent ecosystem.
While the Agentforce platform has yet to hit that big growth spurt that entices investors to pile back into the stock, I do think the company is very well-positioned going into the year. And with more than one big firm touting Salesforce as a buy for 2026, perhaps it’s time to brave the dip as investors adopt more of a wait-and-see mindset with the name.
The stock is attractively priced at 33.9 times trailing price-to-earnings (P/E), and some big names, like Evercore, like Salesforce’s prospects in the new year. All considered, I think it’s hard to overlook Salesforce as it starts 2026 with turbulence, especially if this is the year Agentforce steals the show.
Adobe
Adobe is a name I’d be a bit more cautious with as 2025’s small hint of year-end momentum reverses course. Undoubtedly, there’s a lot of uncertainty when it comes to AI and its impact on the creative software space. With Jefferies and KeyBanc both recently downgrading the stock due to AI uncertainties, it’s not hard to think that 2026 will be another big down year for the firm, especially as AI models become better at creating images and video.
Given the pace at which models are innovating, I find it difficult to justify paying for Adobe’s Firefly, even though it does a great job. Competition in AI is too fierce, and it’s unclear what could nudge shares out of their multi-year trough. At 19.9 times trailing P/E, the stock certainly looks cheap.
But the big question is whether Firefly and the AI integration across other parts of the suite are enough to move the needle higher on growth. Investors are right to be skeptical, but with such a ridiculously low multiple, it might not take long to deliver an upside surprise, especially if Firefly can give creators something that AI model makers can’t.
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