Analysts at Jefferies, including Roger Samuel and Lucy Krimmer, are urging investors to consider selectively buying Australian software stocks after what they call an "indiscriminate" market pullback. The firm says widespread anxiety about new artificial intelligence models has swept through the sector, but that several listed software businesses now trade at valuation levels that provide a defensive floor against potential AI-related disruption.
Jefferies singled out four names it views as comparatively well positioned and rated each at "buy": TechnologyOne, WiseTech Global, SiteMinder and Life360. By contrast, the firm placed Xero on "hold" owing to greater exposure to horizontal competition and short-term financial dilution from an acquisition.
WiseTech Global
Jefferies ranks WiseTech Global as the stock least vulnerable to AI-driven disruption, citing the extreme complexity of global logistics workflows. The bank expects revenue from WiseTech’s flagship CargoWise platform to accelerate to 18% in the second half of 2026 as additional global customers complete their rollouts. Analysts also anticipate upside to earnings as WiseTech integrates its e2open acquisition and realizes meaningful cost synergies.
TechnologyOne
TechnologyOne is described by Jefferies as having a strong historical ability to grow revenue from existing customers, with the firm noting at least 15% annual increases in that metric. The company’s upcoming annual meeting on February 18 is identified as a potential near-term catalyst after management tightened performance hurdles. Jefferies projects TechnologyOne can achieve pre-tax profit margins of 35% or higher by the 2029 financial year.
SiteMinder
As a leading hotel channel manager, SiteMinder is seen as likely to gain importance if AI-driven travel searches further fragment traditional booking channels. Jefferies expects the company to accelerate growth through 2027, driven by new software offerings alongside its core subscription business. The analysts also highlight ongoing cost-management efforts that should produce operating leverage as SiteMinder scales.
Life360
Jefferies points to Life360’s large user base and international expansion as drivers of rapid growth. The firm notes Life360 currently reaches one out of every six smartphone users in the United States and counts roughly 100 million users globally. Life360 is transitioning toward a diversified monetization strategy that leverages advertising, data services and pet tracking. Jefferies forecasts total revenue growth exceeding 30% per year on average over the next three years.
Xero
The analysts view Xero as the most exposed to potential AI disruption because it operates as a horizontal software provider and faces deep-pocketed competitors in the U.S., such as Intuit. Jefferies expects earnings growth to slow near term as Xero absorbs the financial dilution from its recent acquisition of payments firm Melio. The bank does not anticipate the Melio business segment reaching breakeven until the end of the 2028 financial year, a timing that contributes to its "hold" rating for Xero.
Jefferies’ recommendations reflect a mix of product differentiation, customer monetization strategies and expected margin improvement. While the bank sees selective upside across several names, it flags specific vulnerabilities where horizontal competition or acquisition-related dilution could weigh on near-term results.