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Special Report
Amid the “SaaS Apocalypse”, These 3 Names Are Boosting Buybacks
Authored by Leo Miller. First Published: 2/13/2026.
To the dismay of many investors, the rout in software stocks shows no sign of abating. The iShares Expanded Tech-Software Sector ETF (BATS: IGV), a proxy for the industry’s performance, is down nearly 22% year-to-date in 2026.
Amid this weakness, several software companies have taken a confidence-inspiring step: announcing share buyback authorizations. For these beaten-down names, management teams are signaling they believe the market is undervaluing their shares. All data are as of the Feb. 13 close unless otherwise indicated.
DT: Keeping a Lid on 2026 Losses and Boosting Buyback Capacity
First up is observability platform provider Dynatrace (NYSE: DT). Its software helps customers monitor application performance, identify bottlenecks and other issues, and resolve them.
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Key Points
- The massive decline in software stocks, dubbed the “SaaS Apocalypse,” has left many names deeply in the red during 2026.
- However, three software names are expressing confidence going forward, increasing their buyback capacity.
- Two names now have buyback authorizations equal to 9% or more of their market caps.
Dynatrace shares have held up better than many software names in 2026, down about 14%. That performance was partly driven by the firm’s latest earnings report, which beat sales and adjusted EPS estimates; the stock rose 7% after the results. Still, shares remain roughly 40% below their 52-week high.
Dynatrace also announced a $1 billion share repurchase authorization — about 9% of its roughly $11 billion market capitalization.
It’s double the size of the firm’s previous authorization from May 2024, when the shares were significantly higher. The company said the program underscores “the view that our shares are undervalued.”
PEGA’s Buyback Capacity Soars Above 10% of Its Market Cap
Pegasystems (NASDAQ: PEGA) hasn’t been as fortunate as Dynatrace in 2026, with its shares down about 26% year-to-date. The company provides business process management (BPM) software to automate internal workflows. Its GenAI Blueprint tool enables companies to build or improve tools with minimal coding.
As investors worry that artificial intelligence (AI) will make coding easier and threaten traditional software, Pega is positioning itself to benefit from that shift.
Despite beating estimates on sales and adjusted EPS in its latest report, Pegasystems shares fell nearly 12% afterward, as the company’s 2026 guidance may have disappointed some investors.
Pega also announced an additional $1 billion share buyback authorization — roughly 13.5% of the company’s approximately $7.4 billion market capitalization.
The company was more restrained in its explanation, saying, “This authorization reflects our confidence in the durability of our cash flows and our commitment to disciplined capital allocation.” Still, the size of the program relative to the firm’s market cap suggests management sees value in the shares.
Down 30% in 2026, SHOP Announces $2 Billion Buyback Plan
Lastly, e-commerce platform Shopify (NASDAQ: SHOP) has been a particularly large loser in 2026, down about 30% year-to-date. Its tools enable businesses to build and operate direct-to-consumer e-commerce platforms, and revenue has grown at least 20% year-over-year for 14 consecutive quarters. The company also beat estimates on sales and earnings in its latest report, yet the stock fell more than 6% on each of the next two trading days.
Alongside earnings, Shopify announced a $2 billion share buyback — larger in absolute terms than those of DT and PEGA but modest relative to Shopify’s scale, representing about 1.4% of its roughly $146 billion market capitalization. Still, it’s notable because Shopify appears not to have previously authorized a repurchase program.
Buybacks: One Positive Indicator Amid Software’s Stumble
Despite these confidence signals, investors should remain aware of the uphill battle facing the software industry.
Markets worry incumbents’ growth will be limited by new AI tools, and that trend will likely continue — extending a significant headwind for the sector. Investors attempting to “buy the dip” in software should be highly selective.
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