Software companies are pouring record money into R&D, and AI has turned that spend into a running meter. Financial statements show what was spent, not what it earned, so investors and boards can't tell winners from cash burners.
That blind spot is where the next decade's software wealth gets made or lost. Whoever sees R&D return first backs the compounders and avoids the burners.
We rank 250 public software companies on one scale, Ratings v3 (0 to 100), measuring 1-year lagged R&D payback, R&D spend, and net profit strictly from SEC filings.
Every note pairs a primary-filing thesis with live Ratings v3 scores and direct 1-click entry into the 3-statement financial model.
Hexagon's industrial software spin earns owner cash of about a fifth of revenue, but the top line is flat, controls are not effective and a 10-vote share class keeps control in Stockholm.
Digimarc Corporation has strong watermark technology and a 30-year central bank customer, but owner cash is deeply negative, an activist holds 18.5% and new shares keep coming.
Telos Corporation reversed three years of decline on TSA PreCheck enrollment work, but owner cash was about 2% of revenue and the guide shows growth cresting.
Life360 holds the live location record of 102 million monthly users, but after stock pay only about 5% of revenue was left for shareholders.
Every covered software company is evaluated through one standardized framework: quarterly financial statements and 5-year DCF models, published research pieces, and a single R&D Return rating formula.
Clean, scannable quarterly fundamentals, 6 core operating KPIs, explicit 5-year unlevered cash flow schedules, and WACC sensitivity matrices.
Published software equity research pieces, Stock Profile hubs (/research/[ticker]), catalyst notes, and valuation teardowns with quantified operating value levers across the coverage universe.
One unified Ratings v3 (0 to 100) formula combining 45% R&D Spend + 35% Net Profit + 20% 1-Yr Payback (Leader to Laggard), 3-factor percentile ranks, and the 1-year lagged 2×2 R&D Return Quadrant.
