Salesforce Inc (NYSE: CRM) shares were last seen down at 7.9% to trade at 236.23, even after the company topped second-quarter estimates with $10.24 billion in revenue and earnings of $2.91 per share. Despite the impressive numbers, a lower-than-expected revenue guidance for Salesforce's next quarter is dispelling confidence. Sluggish growth despite heavy AI investment is also spelling trouble for the cloud-based blue-chip.
Should CRM's losses hold, it will mark the stock's fifth drop in its last six sessions. Today's move is also poised to the shares' worst session of the year. Over the past nine months, the stock has shed 34.9%, a sharp reversal from its record highs of Dec. 2024. While the equity has slipped below its 20-day moving average, $235 -- an area of support back in April and June -- is acting as a last line of defense.
At least nine firms, including JPMorgan and Wells Fargo Securities, issued price cuts today, the worst coming from Bernstein to $221 from $250. But despite the (overdue) flurry of bear notes today, of the 50 firms in coverage, 36 still rate it a "strong buy."
Options traders have been call skewed lately, per CRM's 50-day call/put ratio of 1.88 at the International Securities (ISE), Cboe Options (CBOE) and NASDAQ OMX PHLX (PHLX), that ranks in the 75th percentile. Today, traders are buying in on a potential comeback. So far today, 93,000 calls have been traded, compared to just 60,000 puts, volume that's seven times the usual amount seen at this point. The reigning contract is the weekly 9/5 strike-call, where new positions are being opened.
The equity has tended to outperform volatility expectations over the past year, as suggested by its Schaeffer's Volatility Scorecard (SVS) of 78 out of 100.
