The best quality software stocks of 2026

2026-06-12 · By Lubin Danilo, founder of Lubin Investment

Intuit, Roper, Salesforce and Bentley all earn the top score on my quality grid. But their valuations range from single to nearly double: Salesforce trades at about 13 times its cash, Bentley near 24. Same quality does not mean same price. Here is how I tell them apart.

• Four makers rated 10/10: Intuit (INTU), Roper (ROP), Salesforce (CRM), Bentley (BSY).
• Salesforce is the cheapest: about 13 times its free cash flow.
• Intuit and Roper follow, around 13 to 14 times.
• Bentley is the most expensive, near 24 times, because its quality is priced in.
• All generate over 25 % free cash flow margin: true cash machines.

Why software dominates my quality selection

Software is the most represented sector at the top of my ranking, and that is no accident. A good maker sells a subscription, collected upfront, with near-zero marginal cost to serve one more customer. The result: huge margins and lots of cash. Free cash flow is the money that truly remains once every bill is paid. All four companies here generate over 25 % of their sales as free cash flow.

My score out of 10 measures that soundness: profitability, cash growth, margins, buybacks, debt. These four tick every box. So the real question is not which is the best company, but which trades at the best price.

The comparison, equal quality, different prices

To compare price, I use P/FCF (price-to-free-cash-flow): the share price divided by annual free cash flow. A P/FCF of 13 means you pay thirteen years of that cash. Here are the four, cheapest to priciest:

• Salesforce (CRM): about 13 times free cash flow. The CRM giant, mid-pivot toward AI agents. Growth around 12 % a year.
• Intuit (INTU): about 13 to 14 times. TurboTax and QuickBooks, a near-monopoly on US small-business accounting and taxes. Growth close to 15 % a year, the fastest of the group.
• Roper (ROP): about 14 times. A collector of niche software businesses, highly diversified, little known to the public but remarkably steady.
• Bentley (BSY): near 24 times. Engineering software for infrastructure (bridges, networks, plants). The priciest, because the most protected.

Why Bentley trades at twice the price

A P/FCF of 24 versus 13 is almost double. Is Bentley half as interesting? Not necessarily. The market pays up for what it deems most durable. Bentley sells software that engineers use on projects lasting ten or twenty years. The cost to switch is enormous. That is a moat, a competitive gap: what stops a rival from taking its place. The stronger the moat, the more the market is willing to pay.

Conversely, Salesforce is cheaper because its growth is slowing and competition in enterprise software is fierce. The market doubts a bit more, so it pays a bit less. Price is not random, it tells the fears and hopes of the moment.

Which one to choose?

There is no single answer, because a low price does not mean the best deal. If you want the deepest discount on solid quality, Salesforce and Intuit look most interesting on paper. If you favor predictability and accept paying more to sleep easy, Bentley holds up. The right reflex is not to grab the cheapest, but to ask, for each one, whether the quality justifies its price.

That is exactly the work I wanted to do in seconds, so I coded it. You can see the detail of each company on its analysis page, for example Intuit, Salesforce or Bentley, and the ranking of undervalued stocks. My full methodology explains every criterion.

FAQ

Why do four makers share the same 10/10 score?

Because my score measures objective financial soundness (profitability, cash, margins, debt), not price. Four companies can be equally solid as businesses while trading at very different prices on the market.

Should you buy the cheapest, Salesforce?

Not automatically. A lower P/FCF can reflect market doubts about growth. The cheapest is only the best deal if its quality holds. Always compare price to soundness, not in absolute terms.

Why is Bentley the most expensive?

Because its moat is seen as very strong: its engineering software is used on very long-term infrastructure projects, with an enormous switching cost. The market pays up for that perceived durability.

Is software always a good sector to invest in?

It is a high-margin, recurring-revenue sector, so structurally attractive. But that guarantees no reasonable entry price. This is not investment advice, do your own research.

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About the author

Written by Lubin Danilo, founder of Lubin Investment. A self-taught individual investor, I have analyzed stocks through their fundamentals for several years and invest my own money with this method. I codified it into a tool that judges a company's quality and its price separately, using criteria drawn from the financial literature (Warren Buffett, Michael Mauboussin, Aswath Damodaran).