“Since 2012, we have interviewed salesforce.com customers at Dreamforce to use as a proxy for assessing the software demand environment. The results point to a stronger spending environment than indicated in our 2017-2012 surveys. Enterprise customers are more optimistic this year while the SMB customers trend line exhibited a downshift, and is a disappointment. Bottom Line: Our field work follows what has been a rotation out of the high valuation momentum names, which has been particularly harsh for the SaaS group given share prices nearly doubled this year. We believe group fundamentals remain strong, and valuations may benefit from better sentiment from a positive earnings season. Importantly, CRM’s valuation is currently in line with the SaaS industry average, and we believe CRM should trade at a premium to the SaaS group considering its 2-5x larger TAM and better predictability.”
According to TipRanks.com, Schwartz is a top 25 analyst with an average return of 27.0% and a 75.6% success rate. Schwartz covers the Technology sector, focusing on stocks such as Ultimate Software, Instructure Inc, and MiX Telematics.
Currently, the analyst consensus on Salesforce.com is a Strong Buy with an average price target of $174.89, implying a 26.9% upside from current levels. In a report issued on September 27, Jefferies also maintained a Buy rating on the stock with a $189 price target.
Based on Salesforce.com’s latest earnings release for the quarter ending July 31, the company reported a quarterly revenue of $3.28 billion and net profit of $299 million. In comparison, last year the company had a net profit of $17.74 million.
Based on the recent corporate insider activity of 476 insiders, corporate insider sentiment is negative on the stock.
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