- CRM
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Salesforce (CRM) closed the most recent trading day at $227.80, moving +1.44% from the previous trading session. This move outpaced the S&P 500’s daily loss of 0.47%. Meanwhile, the Dow experienced a rise of 0.1%, and the technology-dominated Nasdaq saw a decrease of 1.25%.
The stock of customer-management software developer has fallen by 8.03% in the past month, lagging the Computer and Technology sector’s gain of 6.08% and the S&P 500’s gain of 1.15%.
The investment community will be closely monitoring the performance of Salesforce in its forthcoming earnings report. The company is predicted to post an EPS of $3.43, indicating a 5.54% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $11.46 billion, showing a 11.72% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $16.71 per share and a revenue of $46.25 billion, demonstrating changes of +33.47% and +11.38%, respectively, from the preceding year.
Any recent changes to analyst estimates for Salesforce should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.03% lower. Salesforce presently features a Zacks Rank of #3 (Hold).
In terms of valuation, Salesforce is presently being traded at a Forward P/E ratio of 13.44. This valuation marks a discount compared to its industry average Forward P/E of 20.39.
We can additionally observe that CRM currently boasts a PEG ratio of 0.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. As of the close of trade yesterday, the Internet – Software industry held an average PEG ratio of 1.19.
