By Adam Clark

Only a month into the year, and the software sector is running scared. Artificial intelligence could be the boogeyman that gnaws at market share. But Atlassian and Monday.com could ultimately be the fighters of that AI monster.

The software developers will report earnings within the next several days -- Atlassian on Thursday and Monday.com on Monday -- and their numbers are expected by Cantor to at least tame the beast.

Both are core to an area that Wall Street worries will be disrupted by AI tools -- software that helps manage projects and workflow. All the apprension has dragged down their stocks by more than 60% over the past 12 months.

And the companies are confident in their products and, perhaps most important, their own AI savvy -- especially their ability to integrate Anthropic's Claude, the chief platform creatings the angst.

Atlassian's second-quarter report comes after Thursday's market close. Cantor's Thomas Blakey expects 22.5% cloud revenue growth and an earnings margin of 24.5% before interest and taxes.

"We continue to view Atlassian as a sustainable profitable growth software company benefiting from expanding AI usage across project management and software development use-cases, with no checks indicating the 'death of Jira' due to vibe coding," Blakey wrote in a research note.

Jira, one of Atlassian's most well-known tools, is a system that creates and tracks service-desk tickets across an organization.

Despite his upbeat tone, Blakey recognizes challenges for Atlassian's valuation. He kept his Overweight rating on the stock, but lowered his target price to $146 from $240.

Blakey noted the new target represents a valuation of 4.5 times his forecast for Atlassian's revenue in 2027, compared with its average multiple of 7.5 times.

In midday trading, the stock was up 3.4% at $108.56.

Monday.com's fourth-quarter numbers come out before Monday's market open. Blakey expects 23% revenue growth and an EBIT margin of 11.1%.

The company's most pressing problem is negative trends in web traffic after Google made changes to its search result algorithm. Now, Monday.com has to spend money on marketing and sales activity.

Blakey, though, argues the stock has been too harshly punished for that and the wider AI threat, considering revenue growth of about 20% annually and the shift in its go-to-market strategy,

"Monday.com [is] positioning itself as relatively agnostic regarding the AI apps or capabilities customers want to use. If monday.com offers it, use monday.com. If the customer wants to use another provider, monday.com intends to integrate or connect to it," Blakey wrote.

Like for Atlassian, Blakey kept his Overweight rating on Monday.com, but cut his price target. His new target -- $148, down from $215 -- is based on an enterprise value-to-revenue multiple of 3.5 times his forecast for Monday.com in 2027, compared with its three-year average of a 9-times multiple.

Monday.com shares were up 4.2 at $106.01.

Write to Adam Clark at adam.clark@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

February 04, 2026 11:22 ET (16:22 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.