Artificial intelligence has dominated markets this year. But the rush into AI investments has created blind spots. As investors crowd into the biggest winners, several profitable software companies have quietly slipped out of focus, even as their fundamentals improve.
I spoke with Zac Hartley, a Calgary-based entrepreneur and investor known for his transparent approach to investing. Hartley has built a loyal following by disclosing his investments online. On the one hand, he’s a long-term investor, focused on holding simple ETFs in his portfolio. On the other, he reserves some capital for swing trading. That means he’s looking for market trends that could unlock value in certain stocks in a period that can range from a couple of weeks to a few months.
One theme he is watching particularly closely is the widening gap between the stock prices of some of AI’s perceived biggest winners and a group of lesser-discussed software stocks.
Hartley believes AI has inflated some well-known names, while pulling attention from others that remain profitable and continue to grow. He also thinks investors may be underestimating how much more efficient these companies could become as AI tools mature.
He says three names stand out.
LegalZoom (LZ)
LegalZoom has quietly outperformed this year, beating the broader market. Still, its performance has not matched the biggest AI winners, and analysts are somewhat mixed on the stock. That’s where Hartley sees a missed opportunity.
The company already has notable market share as a provider of online legal services to individuals and businesses. And Hartley believes AI tools will enable LegalZoom to win more business, not less.
Interestingly, despite their mixed view on the stock, analysts are projecting solid profit growth in the year ahead.
Toast (TOST)
Toast provides restaurant management software for things like customer orders. The stock has struggled in 2025, which is why Hartley sees upside. His view aligns with analysts, who on average recommend the stock and expect a double-digit return over the next year, according to Bloomberg data.
Toast is early in its profitability journey, but profits are rising steadily. Many of its tools, such as workflow and menu management, are well suited for automation. Hartley believes AI can improve efficiency for restaurants and help Toast bring new features to market more quickly.
Adobe (ADBE)
Adobe is one of the long-term winners in software. This year has been tougher. Investors are worried that generative AI tools could challenge parts of its creative lineup. Those concerns have weighed on the shares, even as Adobe continues adding AI features across its products.
Most analysts still recommend the stock and expect it to move higher over the next year. Wall Street also projects double-digit profit growth in 2026. Hartley argues the current market narrative surrounding Adobe discounts the strength of its business.
The Ticker Take?
Software stocks have had a complicated year. While some have been soaring because of AI excitement, others have been overlooked despite solid financials and AI opportunities of their own.
LegalZoom, Toast and Adobe may fall into that second group. While not AI-first companies, they operate in areas where AI can boost efficiency and accelerate product development. Analyst forecasts point to profit growth and the potential for higher share prices. For investors who think the AI boom has created opportunities beyond the most obvious winners, these three names could be worth a closer look.
Jon Erlichman is a BNN Bloomberg contributor and the host of Ticker Take on YouTube.
