Salesforce.com (CRM) closed at $272.15 in the latest trading session, marking a +1.09% move from the prior day. This move outpaced the S&P 500's daily gain of 0.83%. Meanwhile, the Dow gained 0.77%, and the Nasdaq, a tech-heavy index, added 1.02%.
Heading into today, shares of the customer-management software developer had gained 2.3% over the past month, lagging the Computer and Technology sector's gain of 8.25% and the S&P 500's gain of 4.99%.
The investment community will be closely monitoring the performance of Salesforce.com in its forthcoming earnings report. It is anticipated that the company will report an EPS of $2.77, marking a 8.2% rise compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $10.13 billion, indicating a 8.66% growth compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $11.3 per share and a revenue of $41.17 billion, indicating changes of +10.78% and +8.64%, respectively, from the former year.
Any recent changes to analyst estimates for Salesforce.com should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational 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 moved 0.04% lower. Right now, Salesforce.com possesses a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Salesforce.com has a Forward P/E ratio of 23.83 right now. This valuation marks a discount compared to its industry average Forward P/E of 26.9.
Also, we should mention that CRM has a PEG ratio of 1.85. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Computer - Software industry held an average PEG ratio of 2.35.
The Computer - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 39, placing it within the top 16% of over 250 industries.
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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Salesforce Inc. (CRM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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