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Salesforce, Inc. (CRM), headquartered in San Francisco, California, is a leading enterprise software company specializing in customer relationship management (CRM) solutions. With a market cap of $240.37 billion, Salesforce is a dominant force in the tech industry, offering a comprehensive suite of cloud-based applications for sales, service, marketing, and more to businesses worldwide. Competing with other major players in the enterprise software space, Salesforce's primary rival is Microsoft (MSFT), known for its expansive software offerings and cloud platform, as both companies continue to innovate and shape the future of digital business solutions.
Companies valued at $200 billion or more are typically classified as "mega-cap stocks," and Salesforce comfortably sits within this category as a powerhouse in the tech industry. As a leader in cloud-based customer relationship management (CRM) software, Salesforce has established a dominant market presence driven by innovative solutions and broad adoption across industries.
CRM shares are trading 22.7% below their 52-week high of $318.71, which they hit on Mar. 1. Also, the stock has gained 5% over the past three months, underperforming the Dow Jones Industrial Average Index’s ($DOWI) 6.1% returns over the same time frame.
In the longer term, CRM is down 6.3% on a YTD basis. However, the shares have gained 11.3% over the past 52 weeks. The Dow has gained 8.6% in 2024 and 17.5% over the past year.
To confirm the bearish price action, CRM has been trading below its 200-day moving average since mid-April and 50-day moving average since late August.
Salesforce reported strong Q2 results on Aug. 28, surpassing Wall Street expectations with an 8.4% year-over-year revenue increase to $9.33 billion. The company posted a non-GAAP profit of $2.56 per share, up from $2.12 per share in the same quarter last year. However, Salesforce's revenue forecast for the next quarter is $9.34 billion, slightly below analysts' estimates. Shares of CRM declined by over 2% on the day of the earnings release.
Highlighting the contrast in performance, rival MSFT has outperformed CRM and the border index, with a 24% gain on a YTD basis.
Despite CRM's recent underperformance compared to Dow, analysts are moderately optimistic about its prospects. The stock has a consensus rating of "Moderate Buy" from 40 analysts. The mean price target is $298.13, reflecting a 20.8% premium over current levels.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
