Digital Download – Token Watch

Research evidence excerpt

Digital Download – Token Watch

EUROPE | Software EquityJulyResearch5, 2026

Chart 3 - Coverage ValuationDigital Download – Token Watch

JEFe P/E

We commented last week that extreme one-sided sentiment meant that CY26 CY27

AMS 15x 13x

the sector was likely due a re-rating. This came quicker than expected with BYIT 19x 18x

the sector duly recording the 3rd best week of the year. However, the move CAP 7x 7x

still feels like it is being driven by positioning, rather than renewed long-only CCCDSY 21x14x 20x13x

interest. GBG 12x 10x

NEM 22x 18x

SAP 19x 17x

More Pressure: The average share price performance of the 24 companies we track across SCT 26x 23x

the sector was +5.1%. This is the 3rd best weekly performance of the year, see Chart 5. The SGE 16x 14x

move was broad-based, with all but 2 companies contributing to the rally. The broader market . TEMN 19x 17x

- Stoxx Europe 600 - was also up 2.7% but this is still a week of healthy gains. While this was Source: Jefferies, Factset

a strong week, it is worth reminding that the sector is still down 7% YTD, underperforming the

broader market by c17%. Chart 4 - Coverage Ratings

Coverage RatingsAI news: AI has been the dominant theme of the year and it was the predominant driver of

AMS BUY

this week's performance. The catalysts appeared to be headlines that Meta is planning a cloud

BYIT HOLDbusiness to sell AI compute. Our view is that this improves cash flow at Meta allowing Meta to

CAP HOLD

fund even more capex. However, the market started to question whether a greater emphasis

CCC BUYon ROI may slow capex across the industry. This led to an 8% fall in the SOX over 2 days.

DSY UNPF

Token news: AI is clearly going to continue dominating headlines and 2 other stories caught GBG BUY

our attention during the week: NEM BUY

SAP BUY