Salesforce (CRM) – [ Why We’re Looking At It, Should You Too?]

Salesforce.com (NYSE:CRM), the industry leader in cloud-based customer relation solutions, provides enterprise cloud computing solutions focused on customer relationship management (CRM).

It has recently fell over 25% from Nov high due to its latest earnings and guidance that was released on 30th Nov. Investors were disappointed and selling took place. The fall from last night could be due to an analyst Karl Keirstead of UBS downgrading shares from buy to neutral, and decreasing the one-year price target from $315 to $265.

In July2021, Salesforce completed the Slack acquisition setting the company up as a juggernaut of the workforce communication solutions. Its future is looking brighter!

Salesforce posted a record $6.86 billion in top-line revenue in third-quarter fiscal 2022, up from $5.42 billion for the same period in the prior year and an increase of 27%. For the full fiscal year 2022, Salesforce expects revenue of $26.4 billion, a 24% jump from fiscal 2021. Revenue is expected to reach $31.7 billion to $31.8 billion in fiscal 2023.

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At current price, Salesforce is about 20% undervalued which represent a good opportunity to scale in.

The company has a history of growing acquisitions by integrating them into its cohesive ecosystem of offerings. This bodes well for the Slack acquisition, which closed in fiscal 2022. The goal of $50 billion in sales by fiscal 2026 is well within reach as revenues continue to grow impressively.

Salesforce is a leader in its industry and will continue to execute and make gains for shareholders in the future despite the short term pull back.

Technical Perspective

We can see that the moving averages are sloping down which to conventional teaching means bearish. But if you’re a long term investor, these wouldn’t matter too much especially if you’re investing in a solid company. A good point to scale in could be around $222-230 level as a first batch. Should the support of $222 don’t hold, the next level might be around $208 where an investor can consider a second batch entry. $200 seems a bit tougher unless we see a big pullback in the markets. Investors might take this short term pullback to scale in to good solid companies.

For traders, an entry at the support would provide a good risk reward ratio as indicators are starting to signal an oversold situation too.

Are you watching Salesforce?

Yours

Humbly

Kelwin&Roy

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