The British software sector stars investors should buy now

You might not think of the UK as a market full of promising tech stocks. But our small- and medium-sized companies are punching above their weight, says Dr Mike Tubbs.

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You might not think of the UK as a market full of promising tech stocks. But our small and medium-sized companies are punching above their weight, says Dr Mike Tubbs.

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Large UK software companies
CompanySectorRevenue(last full year)Revenue change(2015-17)Operating margin
Sage GroupBusiness processes£1,715m20%21.5%
Micro FocusBusiness processes£3,209m158% (due to merger)7.6%
AvevaEngineering design£499m15% (1 year)10.1%
Keywords StudiosGaming£151m161%8.3%
First DerivativesFinance£186m59%7.1%
CranewareBusiness processes / Finance£58m29%28.5%
Emis HealthBusiness processes£160m2.9%12.8%
SafeCharge InternationalMobiles$112m12%23.8%
AvastCyber security£653m160%9.2%
SophosCyber security£641m34%loss
Blue PrismBusiness processes£24.5m304%loss
Accesso TechnologyGaming$133m43%6.8%
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Smaller UK software companies
CompanyMarket nicheSales 2017Revenue change(2015-17)Operating margin
QuixantGaming$109m175%15%
MicrogenBusiness processes / Finance£63m100%15%
WANdiscoBusiness processes$20m73% (2016-17)Loss
GreshamFinance£22m50%15%
SopheonBusiness processes$29m40%20%
Tax SystemsFinance£15m200% (2016-17)Loss
BlanccoMobiles£28m80%Loss
ElecosoftEngineering design£20m33%10%
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Dr Mike Tubbs

Highly qualified (BSc PhD CPhys FInstP MIoD) expert in R&D management, business improvement and investment analysis, Dr Mike Tubbs worked for decades on the 'inside' of corporate giants such as Xerox, Battelle and Lucas. Working in the research and development departments, he learnt what became the key to his investing; knowledge which gave him a unique perspective on the stock markets.

Dr Tubbs went on to create the R&D Scorecard which was presented annually to the Department of Trade & Industry and the European Commission. It was a guide for European businesses on how to improve prospects using correctly applied research and development. He has been a contributor to MoneyWeek for many years, with a particular focus on R&D-driven growth companies.