Salesforce (NYSE:CRM) - Share price, News & Analysis

CRM fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	3/6
Past Performance	1/6
Financial Health	5/6
Dividends	0/6

CRM Stock Overview

Salesforce, Inc. provides customer relationship management technology that brings companies and customers together worldwide.

Rewards

Trading at 39.7% below our estimate of its fair value

Earnings are forecast to grow 14.87% per year

Risk Analysis

Large one-off items impacting financial results

Profit margins (5.5%) are lower than last year (19.2%)

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year

Salesforce Competitors

Atlassian

NasdaqGS:TEAM

US$45.1b

Workday

NasdaqGS:WDAY

US$42.1b

Autodesk

NasdaqGS:ADSK

US$41.6b

Cadence Design Systems

NasdaqGS:CDNS

US$40.4b

Price History & Performance

Summary of all time highs, changes and price drops for Salesforce
Historical stock prices
Current Share Price	US$159.65
52 Week High	US$311.75
52 Week Low	US$154.55
Beta	1.15
1 Month Change	-6.87%
3 Month Change	-18.89%
1 Year Change	-28.27%
3 Year Change	3.33%
5 Year Change	75.77%
Change since IPO	3,612.79%

Recent News & Updates

May 19

Salesforce: Don't Add Heading Into Q1 Earnings

Salesforce is scheduled to report its highly anticipated Q1 earnings results on May 31. Investors are keen to parse management's commentary on macro stresses cutting IT spending. Despite the battering, we observed that CRM stock continues to trade at a remarkable growth premium. Therefore, it's incumbent on management to execute well. Our price action analysis suggests that near-term caution is preferred. We see more potential downside ahead and urge investors to wait for a better buy point. We discuss why CRM stock remains a Hold.

May 11

Salesforce, Inc.'s (NYSE:CRM) Intrinsic Value Is Potentially 59% Above Its Share Price

Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Salesforce, Inc...

May 02

Salesforce: Hard To Find A Better Investment

Salesforce is #1 CRM in the world for the eighth year in a row with an increasingly overwhelming dominance. The structure of this business model is very advantageous, especially in the expansionary phases of the economic cycle. From the first day Salesforce was born, Marc Benioff had decided that profitability and philanthropy would be the main pivots of this company. According to the parameters entered, Salesforce's fair value is $304.90 while the current price is $175.

Shareholder Returns

	CRM	US Software	US Market
7D	-4.4%	-2.7%	-2.7%
1Y	-28.3%	-13.6%	-12.9%

Return vs Industry: CRM underperformed the US Software industry which returned -13.6% over the past year.

Return vs Market: CRM underperformed the US Market which returned -12.9% over the past year.

Price Volatility

Is CRM's price volatile compared to industry and market?
CRM volatility
CRM Average Weekly Movement	6.8%
Software Industry Average Movement	11.2%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	2.9%

Stable Share Price: CRM is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: CRM's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1999	73,541	Marc Benioff	https://www.salesforce.com

Salesforce, Inc. provides customer relationship management technology that brings companies and customers together worldwide. Its Customer 360 platform empowers its customers to work together to deliver connected experiences for their customers. The company’s service offerings include Sales to store data, monitor leads and progress, forecast opportunities, gain insights through analytics and relationship intelligence, and deliver quotes, contracts, and invoices; and Service that enables companies to deliver trusted and highly personalized customer service and support at scale.

Salesforce Fundamentals Summary

How do Salesforce's earnings and revenue compare to its market cap?
CRM fundamental statistics
Market Cap	US$158.68b
Earnings (TTM)	US$1.44b
Revenue (TTM)	US$26.49b

109.9x

P/E Ratio

6.0x

P/S Ratio

Is CRM overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
CRM income statement (TTM)
Revenue	US$26.49b
Cost of Revenue	US$7.03b
Gross Profit	US$19.47b
Other Expenses	US$18.02b
Earnings	US$1.44b

Last Reported Earnings

Jan 31, 2022

Next Earnings Date

May 31, 2022

Earnings per share (EPS)	1.45
Gross Margin	73.48%
Net Profit Margin	5.45%
Debt/Equity Ratio	18.2%

How did CRM perform over the long term?

See historical performance and comparison

Valuation

Is Salesforce undervalued compared to its fair value and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

39.7%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: CRM ($159.65) is trading below our estimate of fair value ($264.93)

Significantly Below Fair Value: CRM is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: CRM is poor value based on its PE Ratio (109.9x) compared to the US Software industry average (42.2x).

PE vs Market: CRM is poor value based on its PE Ratio (109.9x) compared to the US market (15.2x).

Price to Earnings Growth Ratio

PEG Ratio: CRM is poor value based on its PEG Ratio (7.4x)

Price to Book Ratio

PB vs Industry: CRM is good value based on its PB Ratio (2.7x) compared to the US Software industry average (3.8x).

Future Growth

How is Salesforce forecast to perform in the next 1 to 3 years based on estimates from 46 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

14.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: CRM's forecast earnings growth (14.9% per year) is above the savings rate (1.9%).

Earnings vs Market: CRM's earnings (14.9% per year) are forecast to grow faster than the US market (12.5% per year).

High Growth Earnings: CRM's earnings are forecast to grow, but not significantly.

Revenue vs Market: CRM's revenue (14.4% per year) is forecast to grow faster than the US market (7.8% per year).

High Growth Revenue: CRM's revenue (14.4% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: CRM's Return on Equity is forecast to be low in 3 years time (10.4%).

Past Performance

How has Salesforce performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

43.8%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: CRM has a large one-off gain of $1.2B impacting its January 31 2022 financial results.

Growing Profit Margin: CRM's current net profit margins (5.5%) are lower than last year (19.2%).

Past Earnings Growth Analysis

Earnings Trend: CRM's earnings have grown significantly by 43.8% per year over the past 5 years.

Accelerating Growth: CRM's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CRM had negative earnings growth (-64.5%) over the past year, making it difficult to compare to the Software industry average (24.9%).

Return on Equity

High ROE: CRM's Return on Equity (2.5%) is considered low.

Financial Health

How is Salesforce's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: CRM's short term assets ($22.9B) exceed its short term liabilities ($21.8B).

Long Term Liabilities: CRM's short term assets ($22.9B) exceed its long term liabilities ($15.3B).

Debt to Equity History and Analysis

Debt Level: CRM's net debt to equity ratio (0.1%) is considered satisfactory.

Reducing Debt: CRM's debt to equity ratio has reduced from 26.7% to 18.2% over the past 5 years.

Debt Coverage: CRM's debt is well covered by operating cash flow (56.6%).

Interest Coverage: CRM's interest payments on its debt are not well covered by EBIT (2.7x coverage).

Balance Sheet

Dividend

What is Salesforce current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.026%

Forecast Dividend Yield

Dividend Yield vs Market

Notable Dividend: Unable to evaluate CRM's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate CRM's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CRM's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CRM's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as CRM has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure

CEO

Marc Benioff (56 yo)

23.25yrs

Tenure

US$28,602,112

Compensation

Mr. Marc R. Benioff Co-Founded Salesforce.com, Inc. in February 1999 and had been its Chief Executive Officer February 2020 until November 30, 2021 and serves as its Co-Chief Executive Officer since Novemb...

CEO Compensation Analysis

Compensation vs Market: Marc's total compensation ($USD28.60M) is above average for companies of similar size in the US market ($USD13.34M).

Compensation vs Earnings: Marc's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: CRM's management team is considered experienced (2 years average tenure).

Board Members

Experienced Board: CRM's board of directors are considered experienced (8.7 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: CRM insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.8%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/22 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/01/31
Annual Earnings	2022/01/31