Investing.com -- Bank of America said the 25% year-to-date slide in the software sector has created selective opportunities, highlighting key stocks as the first names likely to rebound.

Snowflake (NYSE: SNOW), MongoDB (NYSE: MDB), Datadog (NASDAQ: DDOG), and JFrog (NASDAQ: FRONG) are the stocks in question, BofA analyst Koji Ikeda said “no company [was] spared…software sector down 25% YTD,” but argued that these four firms are positioned to outperform once sentiment stabilizes.

Snowflake remains BofA’s top pick as the firm sees it “attractively positioned to be a long-term share gainer in the AI data cloud opportunity.”

Ikeda stated that Snowflake continues to solve a “critical problem: making sense of mountains of data,” and expects any volatility around initial FY27 revenue guidance to be a buying opportunity.

BofA also reiterated its positive view on MongoDB, pointing to accelerating Atlas growth and long-term demand for its JSON document database.

The bank described MongoDB’s technology as “special…and it’s setting the business up nicely as a long-term share gainer of new AI workloads.” While expectations remain high into the next earnings print, Ikeda believes any weakness should be viewed constructively.

On Datadog, BofA pushed back against concerns around competition and slowing growth. The firm commented that “observability is mission critical,” noting broad adoption among AI-native companies. BofA expects non-AI native growth trends to act as a catalyst.

JFrog rounds out the list, with BofA arguing that “more AI = more binaries = more JFrog.” The bank said the stock’s recent drawdown is overdone and that demand for binary management and security should remain strong as AI drives higher code volume and operational risk.