Salesforce (CRM) AI Stock Analysis

• Market Cap: $230.88B
• Dividend Yield: 0.68%
• Average Volume (3M): 9.74M
• Price to Earnings (P/E): 35.2
• Beta (1Y): 1.33
• Revenue Growth: 8.33%
• EPS Growth: 19.69%
• Country: US
• Employees: 76,453
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 2.91
• Shares Outstanding: 952,000,000
• 10 Day Avg. Volume: 12,749,878
• 30 Day Avg. Volume: 9,735,966
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.06
• Enterprise Value/Revenue: 6.20
• Enterprise Value/Gross Profit: 7.99
• Enterprise Value/Ebitda: 20.88
• 1Y Price Target: $333.74
• Price Target Upside: 37.79% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 39

• Rating: 77 Outperform
• Price Target: $286.00 ▲(18.08% Upside)

Salesforce's overall stock score is driven by strong financial performance and positive earnings call sentiment, highlighting robust growth in AI and Data Cloud. The technical analysis suggests caution due to bearish momentum, while the high P/E ratio indicates a premium valuation. The company's strategic focus on innovation and market expansion supports its long-term growth prospects.

Positive Factors

AI and Data Cloud Growth

Salesforce's significant growth in AI and Data Cloud demonstrates its strategic focus on innovation and positions it well in the evolving tech landscape, ensuring long-term competitive advantage and market leadership.

Strong Financial Health

A strong balance sheet and profitability provide Salesforce with the financial stability needed to invest in growth opportunities and weather economic fluctuations, supporting sustainable long-term growth.

Strategic Partnerships

The partnership with Pearson to provide certification exams enhances Salesforce's ecosystem, potentially increasing customer loyalty and expanding its user base, contributing to sustained revenue growth.

Negative Factors

Moderating Revenue Growth

Slowing revenue growth could indicate market saturation or increased competition, potentially impacting Salesforce's ability to maintain its growth trajectory and market share over the long term.

Challenges in Specific Markets

Challenges in key international markets like the UK and Japan may hinder Salesforce's global expansion efforts, affecting its ability to capitalize on international growth opportunities.

Support Headcount Reduction

A significant reduction in support staff could impact service quality and customer satisfaction, potentially leading to customer attrition and affecting long-term revenue stability.

Salesforce Business Overview & Revenue Model

Company Description

Salesforce, Inc. provides customer relationship management technology that brings companies and customers together worldwide. Its Customer 360 platform empowers its customers to work together to deliver connected experiences for their customers. The company's service offerings include Sales to store data, monitor leads and progress, forecast opportunities, gain insights through analytics and relationship intelligence, and deliver quotes, contracts, and invoices; and Service that enables companies to deliver trusted and highly personalized customer service and support at scale. Its service offerings also comprise flexible platform that enables companies of various sizes, locations, and industries to build business apps to bring them closer to their customers with drag-and-drop tools; online learning platform that allows anyone to learn in-demand Salesforce skills; and Slack, a system of engagement. In addition, the company's service offerings include Marketing offering that enables companies to plan, personalize, and optimize one-to-one customer marketing journeys; and Commerce offering, which empowers brands to unify the customer experience across mobile, web, social, and store commerce points. Further, its service offerings comprise Tableau, an end-to-end analytics solution serving various enterprise use cases; and MuleSoft, an integration offering that allows its customers to unlock data across their enterprise. The company provides its service offering for customers in financial services, healthcare and life sciences, manufacturing, and other industries. It also offers professional services; and in-person and online courses to certify its customers and partners on architecting, administering, deploying, and developing its service offerings. The company provides its services through direct sales; and consulting firms, systems integrators, and other partners. Salesforce, Inc. was incorporated in 1999 and is headquartered in San Francisco, California.

How the Company Makes Money

Salesforce generates revenue primarily through subscription fees for its cloud-based services. The company's revenue model is based on a Software as a Service (SaaS) approach, where customers pay for access to its various CRM solutions on a subscription basis, typically billed annually. Key revenue streams include individual product subscriptions, bundled packages, and add-on services. Additionally, Salesforce earns revenue from professional services, such as consulting, implementation, and training. The company has entered into significant partnerships with other tech firms, such as Google and Amazon Web Services, which enhance its offerings and contribute to customer acquisition. Furthermore, Salesforce's AppExchange marketplace allows third-party developers to create and sell applications that integrate with its platform, generating additional revenue through partner commissions.

Salesforce Financial Statement Overview

Summary

Salesforce exhibits strong financial health with robust profitability and a solid balance sheet. The company has effectively managed its leverage and maintained strong cash flow metrics, although recent growth rates have moderated. Continued focus on revenue growth and cash flow management will be key to sustaining its financial performance.

Income Statement

Salesforce demonstrates strong profitability with a consistent increase in gross profit margin, reaching 77.6% in TTM. The net profit margin has improved significantly to 16.9% in TTM, indicating enhanced cost management and operational efficiency. Revenue growth has slowed to 2.36% in TTM, but the company maintains robust EBIT and EBITDA margins at 21.2% and 29.7%, respectively, showcasing solid operational performance.

Balance Sheet

The balance sheet reflects a healthy financial position with a low debt-to-equity ratio of 0.046 in TTM, indicating minimal leverage risk. Return on equity has improved to 11.0% in TTM, reflecting effective use of shareholder funds. The equity ratio remains strong, highlighting a stable capital structure. However, the slight decrease in total assets suggests a need for strategic asset management.

Cash Flow

Cash flow analysis reveals a slight decline in free cash flow growth, down by 1.19% in TTM, which could indicate potential cash management challenges. However, the operating cash flow to net income ratio of 0.58 and a free cash flow to net income ratio of 0.95 in TTM demonstrate strong cash generation relative to earnings, supporting liquidity and operational flexibility.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	39.50B	37.90B	34.86B	31.35B	26.49B	21.25B
Gross Profit	30.67B	29.25B	26.32B	22.99B	19.47B	15.81B
EBITDA	11.73B	11.14B	9.22B	5.64B	3.85B	3.30B
Net Income	6.66B	6.20B	4.14B	208.00M	1.44B	4.07B
Balance Sheet
Total Assets	97.57B	102.93B	99.82B	98.85B	95.21B	66.30B
Cash, Cash Equivalents and Short-Term Investments	15.37B	14.03B	14.19B	12.51B	10.54B	11.97B
Total Debt	2.80B	12.07B	12.59B	14.09B	13.98B	6.28B
Total Liabilities	36.24B	41.76B	40.18B	40.49B	37.08B	24.81B
Stockholders Equity	61.33B	61.17B	59.65B	58.36B	58.13B	41.49B
Cash Flow
Free Cash Flow	12.50B	12.43B	9.50B	6.31B	5.28B	4.09B
Operating Cash Flow	13.17B	13.09B	10.23B	7.11B	6.00B	4.80B
Investing Cash Flow	-3.56B	-3.16B	-1.33B	-1.99B	-14.54B	-3.97B
Financing Cash Flow	-6.94B	-9.43B	-7.48B	-3.56B	7.84B	1.19B

Salesforce Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 242.21
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CRM, the sentiment is Negative. The current price of 242.21 is below the 20-day moving average (MA) of 247.45, below the 50-day MA of 251.30, and below the 200-day MA of 284.55, indicating a bearish trend. The MACD of -2.25 indicates Positive momentum. The RSI at 44.67 is Neutral, neither overbought nor oversold. The STOCH value of 26.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CRM.

Salesforce Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ADBE	79 Outperform	153.59B	22.55	59.11%	―	10.69%	35.23%
NOW	78 Outperform	197.68B	119.62	15.19%	―	21.12%	43.91%
CRM	77 Outperform	$230.88B	35.22	11.20%	0.68%	8.33%	19.69%
SAP	74 Outperform	300.16B	41.58	6.88%	1.01%	10.95%	161.61%
ORCL	71 Outperform	856.52B	70.99	51.51%	0.60%	9.67%	11.23%
WDAY	71 Outperform	62.71B	108.63	6.36%	―	14.21%	-62.56%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%