Xero (XRO) Share Price Surges — Is the Software Sector Recovery Real?
Xero (ASX: XRO) is trading above $81 for the first time since mid-March, lifted by a broad recovery in global software stocks rather than any company-specific news.
What’s driving the move? US accounting software giant Intuit (NASDAQ: INTU), the company behind QuickBooks and Xero’s closest global rival, surged more than 6% overnight, bringing its weekly gain to nearly 15%. The rally is dragging ASX-listed software names higher in sympathy.
How far has XRO fallen — and how far could it bounce? Xero has declined approximately 65% over the past nine months, creating significant technical room for recovery. MM’s immediate price target is the $90 area, representing a further ~10% upside from current levels.
What does XRO need to do to sustain a recovery? The key question for longer-term investors is whether artificial intelligence (AI) represents a growth opportunity or a structural disruption to Xero’s business model. Until that is resolved, a return to the premium valuations seen in 2025 is unlikely.
Which other ASX software stocks are rallying? WiseTech Global (ASX: WTC) is also trading strongly this morning despite a soft broader market. The view is that software stocks as a sector are likely to outperform over the coming weeks to months.
