What The Financials Tell Us About salesforce.com inc. (CRM)

salesforce.com inc. (NYSE:CRM) finished Tuesday with an addition of $3.5 to close at $275.27, an upside of 1.29 percent. An average of 5,034,500 shares of common stock have been traded in the last five days. There was a gain of $4.77 in the past week. The last 20 days have seen an average of 6,183,635 shares traded, while the 50-day average volume stands at 5,902,114.

CRM stock has increased by 3.79% in the last month. The company shares reached their 1-month lowest point of $252.19 on 09/13/21. With the stock rallying to its 52-week high on 09/24/21, shares of the company touched a low of $201.51 and a high of $286.36 in 52 weeks. In spite of this, the price is down -3.87% from the 52-week high.

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Insider Transactions

2 days have passed since salesforce.com inc. (CRM) last reported insider trading activity. Harris Parker, who is Co-Founder and CTO, most recently acquired $4,300 shares at $272.51 per share on Oct 05. In this transaction, the insider spent $1,171,798. Chair of the Board & CEO, Benioff Marc, disposed of 20,000 shares at a price of $272.49 on Oct 05. The insider now owns more than $5,449,744 worth of shares. Prior to that, Chair of the Board & CEO Benioff Marc went on to Sale 20,000 shares at $269.30 each on Oct 04. An amount of $5,385,971 was transacted.

Valuation Metrics

salesforce.com inc. (CRM) has a trailing price-to-earnings (P/E) ratio of 109.19, which compares with the 29.20 for the broader industry and 36.66 for the sector. This means investors are optimistic about the stock’s future prospects. In the last five years, salesforce.com inc.’s PE ratio has ranged between 966.80 and 44.05. The stock’s beta is 1.04. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 11.28, the price-to-book (PB) ratio at 4.63, and the price-to-cash flow ratio at 48.54.

The company has a payout ratio of 0.00%.

The quick ratio of salesforce.com inc. for the three months ended July 30 was 0.90, and the current ratio was 0.90, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.19 and a total debt to equity ratio of 0.21 for the quarter ending July 30. On the profitability front, the trailing 12-month gross margin is 74.30% against a 5-year average of 74.2%. salesforce.com inc.’s EBITDA margin for the year ending July 30 is 15.02%, while its operating margin for the same period stands at 4.50%. Its gross profit as reported stood at $15.81 billion compared to revenue of $21.25 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, salesforce.com inc.’s return on assets was 3.40%, compared to 3.0% over the last five years. In the past year, the return on investment has been 4.50%, and the 5-year average is 4.9%. Meanwhile, the return on equity (ROE) for the past 12 months has been 5.20% and the 5-year average holds at 5.8%. For the broader industry, ROE averaged 3.34 over the past year.

Earnings Surprise

For the three-month period that ended July 30, salesforce.com inc. had $3.35 billion in cash. The analyst consensus anticipated salesforce.com inc.’s latest quarter earnings to come in at $0.92 per share, but it turned out to be $1.48, a 60.90% surprise. For the quarter, EBITDA amounted to $1.39 billion. Shareholders own equity worth $979.0 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at salesforce.com inc. (CRM) price momentum. RSI 9-day as of the close on 05 October was 59.70%, suggesting the stock is Neutral, with historical volatility in this time frame at 27.05%.

As of today, CRM’s price is $272.88 +1.76% or $4.77 from its 5-day moving average. CRM is currently trading +4.82% higher than its 20-day SMA and +26.47% higher than its 100-day SMA. However, the stock’s current price level is +13.04% above the SMA50 and +21.04% above the SMA200.

The stochastic %K and %D were 57.29% and 57.99%, respectively, and the average true range (ATR) was 6.59. With the 14-day stochastic at 64.70% and the average true range at 6.34, the RSI (14) stands at 59.51%. The stock has reached -2.09 on the 9-day MACD Oscillator while the 14-day reading was at 2.19.

Analyst Ratings

Piper Sandler upgraded salesforce.com inc. (NYSE: CRM) to a an Overweight rating in its most recent analyst report. Previously, the stock was rated as a a Neutral.The consensus rating for salesforce.com inc. (CRM) among analysts is Buy. According to current brokerage recommendations, 0 brokerage firms advise that investors sell CRM, while 7 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 4 analysts, while 37 others rate it as a “buy”.

What is CRM’s price target for the next 12 months?

Analysts predict a range of price targets between $212.00 and $375.00, with a median target of $320.50. Taking a look at these predictions, the average price target given by analysts for salesforce.com inc. (CRM) stock is $318.38.


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