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Salesforce.com (CRM) Laps the Stock Market: Here's Why

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The most recent trading session ended with Salesforce.com (CRM - Free Report) standing at $225.13, reflecting a +1.77% shift from the previouse trading day's closing. The stock outpaced the S&P 500's daily gain of 0.74%. At the same time, the Dow added 0.58%, and the tech-heavy Nasdaq gained 1.13%.

Analysts and investors alike will be keeping a close eye on the performance of Salesforce.com in its upcoming earnings disclosure. The company's earnings report is set to go public on November 30, 2023. The company is forecasted to report an EPS of $2.06, showcasing a 47.14% upward movement from the corresponding quarter of the prior year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.71 billion, up 11.08% from the year-ago period.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $8.06 per share and a revenue of $34.75 billion, signifying shifts of +53.82% and +10.84%, respectively, from the last year.

Any recent changes to analyst estimates for Salesforce.com should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Salesforce.com is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, Salesforce.com is holding a Forward P/E ratio of 27.46. This valuation marks a discount compared to its industry's average Forward P/E of 29.05.

It is also worth noting that CRM currently has a PEG ratio of 1.22. 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 Computer - Software industry had an average PEG ratio of 2.42.

The Computer - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 61, this industry ranks in the top 25% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow CRM in the coming trading sessions, be sure to utilize Zacks.com.


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