Nvidia earnings might have reignited the artificial-intelligence trade, but it was software stocks that were the best performers in the S&P 500 on Thursday.
One of the stocks leading the charge was Veeva Systems, which surged 20% to $294.54 on Thursday and was the second best-performing stock in the S&P 500.
Shares of the software company, however, weren't the only ones making outsize moves.
Salesforce advanced more than 20% and was the best performer in the S&P 500 after the software company topped analysts' second-quarter expectations and expanded its partnership with Anthropic. ServiceNow and Datadog were among the other software stocks rising sharply on Thursday.
Veeva stock was on pace for its best ever daily percentage gain, according to Dow Jones Market Data.
Nearly 20 analyst firms raised price targets on the shares after the life sciences cloud solutions provider posted better-than-expected quarterly earnings and raised its fiscal-year profit outlook well above Wall Street expectations.
Of note for Wall Street was that Veeva reported that subscription revenue grew 16% in the quarter, a sign that AI isn't negatively impacting the business. Veeva also posted double-digit-revenue growth in its commercial segment.
"Veeva has strung together multiple solid quarters, which combined with improving sentiment more broadly in life sciences, should keep a bid in the stock," Morgan Stanley analyst Craig Hettenbach wrote Thursday.
The analyst raised his price target on the stock to $275 from $215 and noted that the next catalyst was the company's annual investor day on Nov. 5.
"This event is likely to serve as a referendum on the company's AI strategy," Hettenbach wrote. "Management has amplified its AI messaging in the past few quarters and we'll be watching for details on what it means for the business model in the coming years."
The bullish view was widespread across Wall Street.
Guggenheim wrote that Veeva is a "quintessential vertical software company that has grown to become indispensable for its customers." The firm raised its price target on the stock to $310 from $276 and maintained a Buy rating on the shares.
Barclays analyst Saket Kalia, meanwhile, also raised his price target on Veeva to $315 from $275, writing that the acceleration in subscription revenue was an excellent sign of growth for the company.
Veeva Systems' earnings even earned praise from some who are more skeptical.
Canaccord raised its price target on Veeva to $260 from $220, but kept a Hold rating on the stock. The firm noted the fiscal 2027 second-quarter earnings were one of the "cleanest quarters" in some time and it's warming up to the company's growth story.
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