Wall Street's going crazy over a group of technology stocks called 'MAGS' - Here's why

Most people are familiar with the so-called "FANG" stocks, an acronym created by CNBC's "Mad Money" host Jim Cramer, that represent the four best-performing tech stocks: Facebook, Amazon, Netflix, and Google.

But there's a new acronym in town that stands for the four best performing tech stocks on the enterprise tech side: "MAGS," or Microsoft, Amazon, Google, and Salesforce.

Amazon and Google aren't normally considered enterprise stocks, but alongside Microsoft and Salesforce, they are among the leaders in cloud computing. That is, they rent out computer capacity in their data centers, so that customers don't have to buy a bunch of hardware and software to build their own data centers. Amazon's market-leading entry, Amazon Web Services (AWS), is on track to book $7 billion in revenue this year.

The acronym itself may not have entirely caught on with the mainstream yet, but according to a Deutsche Bank note on Wednesday, the MAGS stocks have far outperformed the rest of the pack over the past year, and will continue to show huge upside.

"Investors who went long the shares of the four leading public cloud vendors Microsoft, Amazon, Google and Salesforce (the MAGS trade? alright, we know that it's not as cool as FANG) would be finishing 2015 in a very good mood," the note said.

The four companies have a combined market cap of $1.3 trillion, while growing roughly 50% in share price on average over the past year.

Deutsche Bank added the chart below to illustrate MAGS' strong growth:

The note highlighted that these four stocks will likely further excel next year because investor interest continues to be extremely high and the cloud business is still in its early stages. It also noted that Google, Salesforce, and Microsoft's cloud software businesses are considered to be a good position because Amazon's cloud business, Amazon Web Services, have yet to show much progress on the software side.

Amazon, meanwhile, continues to be the stock with by far the most upside potential, even on the enterprise side, largely due to AWS's massive growth. As MKM Partners wrote in a note Tuesday, "We consider the rise of AWS as the most consequential development in the IT sector in many decades."

Deutsche Bank also wrote that Google is the one company that could surprise with a strong push on the cloud side, which is still considered to be lagging behind AWS and Microsoft Azure, especially following the recent hire of former VMware CEO Diane Greene.

Google's increased focus on the enterprise side could potentially lead to a Salesforce acquisition too, it noted, as it needs a stronger sales and support team in the space.

"The consensus Street view is that Google now needs to build a material enterprise sales and support presence and that it is likely to do so either by going on a sales hiring spree or by acquiring an established cloud vendor (Salesforce?) in 2016," it wrote.

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.