The artificial-intelligence trade has lifted up semiconductor and hardware stocks, but other parts of the tech sector have missed out on the big gains.

In fact, some software and information-technology stocks are trading near their lowest multiples in recent history on a price-to-earnings basis. This comes as money has been rotating out of those plays as investors seek out more attractive opportunities in AI infrastructure.

The dynamic is the source of fierce Wall Street debate. Some see an opportunity to buy up quality stocks at bargain prices, while others argue many of the plays might now be cheap for good reason, as AI could fundamentally damage their business models.

“There’s frustration with the pace of AI revenues, which are still very small,” Rob Oliver, senior research analyst at Baird, told MarketWatch. Meanwhile, AI-native startups represent more competition for traditional software companies.

MarketWatch took a look at major technology stocks trading within 10% of their five-year forward P/E lows. Among stocks either in the Nasdaq-100 Index, the S&P 500 index’s information-technology sector or the ”Magnificent Seven,” 10 fit the bill, including high-profile names like Adobe, Salesforce and ServiceNow.

Qnity Electronics also met the criteria but was excluded due to the fact that it recently spun off from DuPont de Nemours and lacks a comparable five-year trading history.

Adobe has been hit particularly hard this year amid fears that AI-native competitors like Figma and Canva are eating its lunch, even as Adobe promotes its own AI tool, called Firefly.

“Adobe faces far more competition today than it did a few years ago,” said Oliver, who has a neutral rating on the stock. “Part of the multiple decline for Adobe is because of the increased competition. Part of it is because the growth rate has declined now, and people are questioning whether it will be a double-digit grower.”

KeyBanc analyst Jackson Ader downgraded both ServiceNow and Adobe shares to underweight from sector-weight earlier this week, writing in a note that both companies are expected to see declining revenue growth. After Adobe’s earnings report last week, Ader said he believes the stock is unlikely to recover in 2026 as it faces increasing competition from not only AI-native applications but also developers of large language models. “The diversity of players developing AI capabilities that, at their heart, are creation machines makes Adobe’s position in the marketplace a difficult one,” Ader wrote.

Ader joins several other analysts with his cautious view: Melius Research’s Ben Reitzes downgraded Adobe’s stock to sell from hold in August. Earlier this month, Wedbush analyst Dan Ives wrote that Adobe is unlikely to recover from AI disruption as AI tools shrink the company’s core professional-user base. While Bernstein analyst Mark Moerdler gives Adobe’s stock an outperform rating, he wrote in a note last week that there’s not enough data for the company to “disprove the bear thesis” yet.

ServiceNow has been regarded by many analysts as an AI success story in the software industry. It was one of the first software companies to successfully implement price increases for its AI-enabled “Pro Plus” tier and shift away from per-user to usage-based pricing.

However, Ader said he sees an increasing likelihood that ServiceNow’s business becomes more exposed to AI risk in the coming quarters. Shares of ServiceNow fell almost 12% on Monday, partly due to a recent Bloomberg report suggesting that the company is in talks to purchase cybersecurity company Armis. Investors are concerned that an acquisition could divert attention away from AI efforts.

Bernstein analyst Peter Weed pushed back on the bearish sentiment surrounding ServiceNow, calling it “the cheapest large-cap software stock” after the selloff. Weed believes a potential acquisition of Armis would be strategically aligned with ServiceNow’s architecture and could drive revenue growth, he said.

Salesforce has faced skepticism this year regarding its ability to generate revenues from its Agentforce platform, which allows customers to build and deploy AI agents. But the company’s earnings call in December signaled momentum among customers paying for AI solutions and an increasing volume of AI tokens processed. The company has also enacted price increases on its products, which some analysts are taking as an encouraging sign that Salesforce’s AI offerings are adding value for customers.

“Salesforce is a very inexpensive stock, and our checks have continued to support that there’s interest in Agentforce,” Oliver said. He has outperform ratings on Salesforce and ServiceNow shares.

Outside of traditional software, shares of IT research firm Gartner have been hit hard this year due to slowing growth in contract values. While Gartner’s stock is the fifth-worst performer in the S&P 500 so far this year, William Blair’s Andrew Nicholas said he believes the impact of AI on the IT research firm has been overstated and gives the stock an outperform rating.

In a November note, Nicholas wrote that the company has been deploying AI tools internally to improve efficiency, and customers have utilized Gartner to help with their own AI strategies.