Technology

Salesforce.com (CRM) Outpaces Stock Market Gains: What You Should Know

Salesforce.com (CRM) closed the most recent trading day at $161.14, moving +1.5% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.88%. Elsewhere, the Dow gained 0.55%, while the tech-heavy Nasdaq added 1.32%.

Heading into today, shares of the customer-management software developer had lost 1.32% over the past month, lagging the Computer and Technology sector's gain of 5% and the S&P 500's gain of 3.96% in that time.

Wall Street will be looking for positivity from CRM as it approaches its next earnings report date. On that day, CRM is projected to report earnings of $0.61 per share, which would represent a year-over-year decline of 17.57%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.68 billion, up 22.52% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.66 per share and revenue of $16.11 billion, which would represent changes of -3.27% and +21.31%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for CRM. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 9.66% lower. CRM is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note CRM's current valuation metrics, including its Forward P/E ratio of 59.63. This valuation marks a premium compared to its industry's average Forward P/E of 31.02.

We can also see that CRM currently has a PEG ratio of 2.61. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Computer - Software stocks are, on average, holding a PEG ratio of 2.24 based on yesterday's closing prices.

The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 11, which puts it in the top 5% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


Click to get this free report

salesforce.com, inc. (CRM): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.