- CRM
- ^GSPC
- ^DJI
Salesforce (CRM) closed at $192.98 in the latest trading session, marking a +1.04% move from the prior day. This change outpaced the S&P 500’s 0.17% loss on the day. On the other hand, the Dow registered a gain of 0.49%, and the technology-centric Nasdaq decreased by 0.83%.
Shares of the customer-management software developer have appreciated by 12.66% over the course of the past month, outperforming the Computer and Technology sector’s gain of 3.01%, and the S&P 500’s gain of 3.52%.
Investors will be eagerly watching for the performance of Salesforce in its upcoming earnings disclosure. On that day, Salesforce is projected to report earnings of $3.27 per share, which would represent year-over-year growth of 12.37%. In the meantime, our current consensus estimate forecasts the revenue to be $11.3 billion, indicating a 10.44% growth compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $14.16 per share and a revenue of $46.09 billion, indicating changes of +13.1% and +14.31%, respectively, from the former year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Salesforce. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the business health and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we’ve crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
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 last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.24% decrease. At present, Salesforce boasts a Zacks Rank of #3 (Hold).
Digging into valuation, Salesforce currently has a Forward P/E ratio of 13.49. This represents a discount compared to its industry average Forward P/E of 21.72.
One should further note that CRM currently holds a PEG ratio of 0.75. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company’s expected earnings growth trajectory. By the end of yesterday’s trading, the Internet – Software industry had an average PEG ratio of 1.2.
