Five9 Inc. (NASDAQ:FIVN) is one of the the best small-cap tech stocks to invest in now. On January 15, Morgan Stanley lowered its price target on Five9 to $26 from $30, maintaining the Equal Weight rating. The firm noted that SaaS stocks lagged the broader software and technology sectors in 2025.

However, growing evidence suggests that AI-related risks may be less severe than previously expected, offering a more positive outlook for the group in 2026. Despite this, the company remains selectively opportunistic due to the persistent lack of widespread upward revisions to corporate spending.

On January 12, Barclays analyst Raimo Lenschow cut the company’s price target on Five9 to $25 from $29 with an overweight rating on the stock. This adjustment was made as part of a broader outlook to 2026 for the software sector, where Barclays remains broadly bullish despite reduced targets. The firm cited stable macroeconomic conditions and IT spending, combined with low stock valuations and the fact that the sector is currently underperforming, as reasons for a favorable setup next year.

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Five9 Inc. (NASDAQ:FIVN), together with its subsidiaries, provides intelligent cloud software for contact centers in the US and internationally. It offers a CX platform that provides a suite of applications, enabling the breadth of customer service, sales and marketing functions.

While we recognize FIVN’s potential as an investment, we believe that certain AI stocks offer greater upside potential and less downside risk. If you’re looking for an extremely undervalued AI stock that will also benefit significantly from Trump-era tariffs and the onshoring trend, check out our free report on the best short term AI stock.

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Disclosure: no. This article is originally published in Monkey Insider.