We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Salesforce's (CRM) Q2 Earnings Exceed Expectations?
Read MoreHide Full Article
We expect salesforce.com Inc. (CRM - Free Report) to beat expectations when it reports second-quarter fiscal 2017 results on Aug 31, 2016.
Why a Likely Positive Surprise?
Our proven model shows that Salesforce is likely to beat earnings because it has the right combination of two key ingredients.
Positive Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate (6 cents per share) and the Zacks Consensus Estimate (5 cents per share), stands at +20.00%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.
Zacks Rank #3 (Hold): Note that stocks with a Zacks Rank of #1 (Strong Buy), 2 (Buy) and 3 have a significantly higher chance of beating earnings. The sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
The combination of Salesforce’s Zacks Rank #3 and +20.00% ESP makes us very confident in looking for a positive earnings beat.
What is Driving the Better-Than-Expected Earnings?
The higher number of deal wins and geographical contributions act as a tailwind for the company. We consider the rapid adoption of Salesforce1 Customer Platform to be a positive. Overall, the company’s diverse cloud offerings and considerable spending on digital marketing remain the catalysts. Moreover, strategic acquisitions and the resultant synergies are expected to benefit over the long run.
It is worth mentioning that recently Salesforce inked an agreement to buy data analytics startup, BeyondCore. The acquisition is anticipated to boost Salesforce’s Analytics Cloud division’s capabilities. The terms of the deal have not been disclosed yet, although it is said to close by the end of this year.
Acquisitions have always been one of Salesforce’s key growth strategies. Over the past few years, the company has acquired or partnered a number of companies. This year alone, the company has completed or is in the midst of as many as nine acquisition deals, which include the recently concluded Demandware buyout.
In view of increasing customer adoption and satisfactory performances, market research firm Gartner acknowledged Salesforce as the leading social CRM solution provider. We believe that the rapid adoption of Salesforce’s platforms indicates solid growth opportunities in the ever-growing cloud computing segment.
Here are some other companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Broadcom Limited (AVGO - Free Report) with an Earnings ESP of +0.87% and a Zacks Rank #3
The Cooper Companies Inc. (COO - Free Report) with Earnings ESP of +0.44% and a Zacks Rank #3
Science Applications International Corporation (SAIC - Free Report) with an Earnings ESP of +1.27% and a Zacks Rank #3
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Will Salesforce's (CRM) Q2 Earnings Exceed Expectations?
We expect salesforce.com Inc. (CRM - Free Report) to beat expectations when it reports second-quarter fiscal 2017 results on Aug 31, 2016.
Why a Likely Positive Surprise?
Our proven model shows that Salesforce is likely to beat earnings because it has the right combination of two key ingredients.
Positive Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate (6 cents per share) and the Zacks Consensus Estimate (5 cents per share), stands at +20.00%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.
Zacks Rank #3 (Hold): Note that stocks with a Zacks Rank of #1 (Strong Buy), 2 (Buy) and 3 have a significantly higher chance of beating earnings. The sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
The combination of Salesforce’s Zacks Rank #3 and +20.00% ESP makes us very confident in looking for a positive earnings beat.
What is Driving the Better-Than-Expected Earnings?
The higher number of deal wins and geographical contributions act as a tailwind for the company. We consider the rapid adoption of Salesforce1 Customer Platform to be a positive. Overall, the company’s diverse cloud offerings and considerable spending on digital marketing remain the catalysts. Moreover, strategic acquisitions and the resultant synergies are expected to benefit over the long run.
It is worth mentioning that recently Salesforce inked an agreement to buy data analytics startup, BeyondCore. The acquisition is anticipated to boost Salesforce’s Analytics Cloud division’s capabilities. The terms of the deal have not been disclosed yet, although it is said to close by the end of this year.
Acquisitions have always been one of Salesforce’s key growth strategies. Over the past few years, the company has acquired or partnered a number of companies. This year alone, the company has completed or is in the midst of as many as nine acquisition deals, which include the recently concluded Demandware buyout.
In view of increasing customer adoption and satisfactory performances, market research firm Gartner acknowledged Salesforce as the leading social CRM solution provider. We believe that the rapid adoption of Salesforce’s platforms indicates solid growth opportunities in the ever-growing cloud computing segment.
SALESFORCE.COM Price and EPS Surprise
SALESFORCE.COM Price and EPS Surprise | SALESFORCE.COM Quote
Other Stocks to Consider
Here are some other companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Broadcom Limited (AVGO - Free Report) with an Earnings ESP of +0.87% and a Zacks Rank #3
The Cooper Companies Inc. (COO - Free Report) with Earnings ESP of +0.44% and a Zacks Rank #3
Science Applications International Corporation (SAIC - Free Report) with an Earnings ESP of +1.27% and a Zacks Rank #3
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>