As the shift to digitization has accelerated over the years, the importance of business analytics has also increased manifold. With the help of business analytics, organizations are able to gather data, gain valuable insights and make informed decisions, thereby boosting profitability.
Businesses can gather data from various departments as well as smart devices that are connected via the Internet of Things. Upon collecting such data, they are separated for identifying patterns. The advent of machine learning (“ML”) has been instrumental in data mining as ML algorithms can accelerate the process by comprehending trends and patterns. Once the patterns have been established, organizations can study the data to better understand their business operations and utilize analytics to predict possible outcomes by building models based on existing data and trends.
This helps organizations to increase their productivity and boost efficiency as they can take note of the aspects that are working best for them and improve upon other areas as well. Moreover, organizations can better serve their customers with the help of marketing analytics, which is part of business analytics, as they can understand their behaviors, likes, and dislikes, and offer them products and services based on those parameters. What’s more, the analytics can also be presented in a visualized manner for better comprehension by technology experts as well as businesspersons.
In fact, the spread of the coronavirus boosted the adoption of data analytics, through which firms can make informed business decisions. During the height of the pandemic last year, a TechRepublic article published on May 28, 2020, citing Sisense’s State of BI & Analytics Report 2020: Special COVID-19 Edition mentioned that 49% of companies were utilizing data analytics “more or much more” than before the pandemic. The article further stated that 55% of companies were utilizing data to become more efficient as well as predicting outcomes while 47% were using it to aid customer interactions.
The advent of cloud computing has also provided a leg up to business analytics as organizations are opting for cloud analytics services due to factors such as reduced costs, flexibility, availability of several analytics tools, and so on.
Reflective of the positive developments that business analytics are providing to organizations, it is no surprise that the business analytics market is expected to grow going forward. Per a report by Mordor Intelligence, the business analytics market is estimated to witness a CAGR of 7.3% from 2021 to 2026.
3 Stocks to Watch Out For
The adoption of business analytics seems poised to grow further as organizations continue to derive useful insights by analyzing data from their operations and make informed decisions that can prove beneficial for them. This seems then a prudent time to look at companies that stand to benefit from this upswing. We have selected three such stocks that carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Adobe Inc. (ADBE – Free Report) provides business analytics services, among others, through its Adobe Analytics which is available as a cloud-based service.
Shares of Adobe have risen 33.3% year to date. The Zacks Consensus Estimate for its current-year earnings increased 2.9% over the past 90 days. The company’s expected earnings growth rate for the current year is 20.9%.
International Business Machines Corporation (IBM – Free Report) offers business analytics through services such as IBM Planning Analytics with Watson and IBM Cognos Analytics.
Shares of International Business Machines have risen 10.9% year to date. The Zacks Consensus Estimate for its next-year earnings increased 0.4% over the past 30 days. The company’s expected earnings growth rate for the current year is 24.8%.
SAP SE (SAP – Free Report) offers its suite of business analytics through the SAP Analytics Cloud, which includes business intelligence, augmented analytics, predictive analytics, and enterprise planning.
Shares of SAP have gained 14.9% year to date. The Zacks Consensus Estimate for its current-year earnings increased 12% over the past 60 days. The company’s expected earnings growth rate for the current year is 16%.