Salesforce Valuation

Is CRM undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of CRM when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: CRM ($270.37) is trading below our estimate of fair value ($417.55)

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


Key Valuation Metric

Which metric is best to use when looking at relative valuation for CRM?

Other financial metrics that can be useful for relative valuation.

CRM key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue7.5x
Enterprise Value/EBITDA28.4x
PEG Ratio3.4x

Price to Earnings Ratio vs Peers

How does CRM's PE Ratio compare to its peers?

The above table shows the PE ratio for CRM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average58.3x
ADBE Adobe
43.4x17.1%US$208.3b
INTU Intuit
61.2x17.4%US$169.4b
SNPS Synopsys
55.4x13.8%US$77.9b
CDNS Cadence Design Systems
73.4x15.9%US$76.4b
CRM Salesforce
63.4x18.7%US$262.3b

Price-To-Earnings vs Peers: CRM is expensive based on its Price-To-Earnings Ratio (63.4x) compared to the peer average (58.3x).


Price to Earnings Ratio vs Industry

How does CRM's PE Ratio compare vs other companies in the US Software Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a15.7%
n/an/an/a
No. of CompaniesPE048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a15.7%
n/an/an/a
No more companies

Price-To-Earnings vs Industry: CRM is expensive based on its Price-To-Earnings Ratio (63.4x) compared to the US Software industry average (42x).


Price to Earnings Ratio vs Fair Ratio

What is CRM's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

CRM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio63.4x
Fair PE Ratio57.5x

Price-To-Earnings vs Fair Ratio: CRM is expensive based on its Price-To-Earnings Ratio (63.4x) compared to the estimated Fair Price-To-Earnings Ratio (57.5x).


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst CRM forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$270.37
US$334.97
+23.9%
8.1%US$390.00US$231.00n/a41
Apr ’25US$302.26
US$333.54
+10.3%
8.0%US$390.00US$231.00n/a44
Mar ’25US$316.88
US$326.33
+3.0%
10.1%US$390.00US$231.00n/a46
Feb ’25US$283.80
US$286.60
+1.0%
11.9%US$390.00US$212.00n/a45
Jan ’25US$263.14
US$275.87
+4.8%
11.5%US$350.00US$159.00n/a46
Dec ’24US$260.00
US$270.21
+3.9%
10.9%US$345.00US$159.00n/a46
Nov ’24US$203.91
US$254.53
+24.8%
11.6%US$340.00US$159.00n/a46
Oct ’24US$202.78
US$256.27
+26.4%
11.6%US$340.00US$159.00n/a47
Sep ’24US$221.53
US$254.64
+14.9%
12.0%US$340.00US$159.00n/a46
Aug ’24US$224.27
US$243.36
+8.5%
12.2%US$329.00US$153.00n/a46
Jul ’24US$211.26
US$239.51
+13.4%
11.2%US$325.00US$153.00n/a45
Jun ’24US$212.90
US$236.67
+11.2%
12.3%US$325.00US$153.00n/a45
May ’24US$197.79
US$228.81
+15.7%
16.4%US$384.30US$145.00n/a46
Apr ’24US$199.78
US$228.05
+14.2%
16.6%US$384.30US$145.00US$302.2647
Mar ’24US$167.35
US$198.85
+18.8%
23.1%US$384.30US$119.00US$316.8847
Feb ’24US$171.82
US$195.36
+13.7%
24.0%US$384.30US$119.00US$283.8047
Jan ’24US$132.59
US$196.75
+48.4%
17.9%US$310.00US$134.00US$263.1445
Dec ’23US$147.00
US$203.11
+38.2%
16.9%US$310.00US$150.00US$260.0046
Nov ’23US$159.82
US$218.45
+36.7%
16.0%US$315.00US$150.00US$203.9147
Oct ’23US$143.84
US$222.11
+54.4%
17.7%US$385.00US$150.00US$202.7846
Sep ’23US$153.53
US$227.21
+48.0%
16.9%US$385.00US$150.00US$221.5347
Aug ’23US$182.98
US$247.22
+35.1%
17.0%US$385.00US$175.00US$224.2746
Jul ’23US$168.20
US$251.89
+49.8%
17.5%US$385.00US$175.00US$211.2646
Jun ’23US$176.07
US$254.86
+44.7%
17.7%US$385.00US$175.00US$212.9048
May ’23US$175.94
US$295.94
+68.2%
13.5%US$385.00US$223.00US$197.7946
Apr ’23US$212.25
US$298.29
+40.5%
13.4%US$385.00US$225.00US$199.7846

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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