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What's in Store for Salesforce (CRM) This Earnings Season?
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Salesforce (CRM - Free Report) is slated to release fourth-quarter fiscal 2021 results on Feb 25.
For the fiscal fourth quarter, the company projects total revenues to lie between $5.665 billion and $5.675 billion. Moreover, non-GAAP earnings are expected between 73 cents and 74 cents per share.
The Zacks Consensus Estimate for revenues is pegged at $5.68 billion, indicating an increase of 17% from the year-ago quarter.
Also, the consensus mark for earnings has remained unrevised at 75 cents per share for the past 30 days. The bottom line is expected to increase 13.6% year on year.
Notably, Salesforce’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, the average beat being 67.9%.
Let’s see how things have shaped up prior to this announcement.
Factors at Play
Salesforce’s quarterly performance is likely to have benefited from the robust demand environment as customers are undergoing a major digital transformation. The company’s ability to provide integrated solutions for customers’ business problems is expected to have been a key growth driver.
The firm’s performance is also likely to have gained from its firm focus on building and expanding relationships with leading brands across industries and geographies. In addition, significant growth opportunities in the public sector are likely to have been a tailwind during the quarter under review.
Growth across all its four major cloud service offerings, Sales Cloud, Service Cloud, Platform and other plus Marketing & Commerce Cloud, is expected to have boosted Salesforce’s subscription and supported the revenue stream, which is a major catalyst.
Additionally, the acquisitions of Tableau and Vlocity are anticipated to have significantly aided the company’s top-line growth during the quarter to be reported.
Nonetheless, decline in software spending by small & medium businesses (SMBs) due to the coronavirus outbreak might have affected the company’s fiscal fourth-quarter performance.
Further, stiff competition from Oracle and Microsoft is a concern in addition to forex headwinds. Increasing investment in international expansions and data centers might have eroded the company’s profitability during the to-be-reported quarter.
What Our Model Says
Our proven model does not predict an earnings beat for Salesforce this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Salesforce currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Autodesk, Inc. (ADSK - Free Report) has an Earnings ESP of +2.29% and carries a Zacks Rank of 3, currently.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +0.75% and currently holds a Zacks Rank of 3.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
What's in Store for Salesforce (CRM) This Earnings Season?
Salesforce (CRM - Free Report) is slated to release fourth-quarter fiscal 2021 results on Feb 25.
For the fiscal fourth quarter, the company projects total revenues to lie between $5.665 billion and $5.675 billion. Moreover, non-GAAP earnings are expected between 73 cents and 74 cents per share.
The Zacks Consensus Estimate for revenues is pegged at $5.68 billion, indicating an increase of 17% from the year-ago quarter.
Also, the consensus mark for earnings has remained unrevised at 75 cents per share for the past 30 days. The bottom line is expected to increase 13.6% year on year.
Notably, Salesforce’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, the average beat being 67.9%.
Let’s see how things have shaped up prior to this announcement.
Factors at Play
Salesforce’s quarterly performance is likely to have benefited from the robust demand environment as customers are undergoing a major digital transformation. The company’s ability to provide integrated solutions for customers’ business problems is expected to have been a key growth driver.
salesforce.com, inc. Price and Consensus
salesforce.com, inc. price-consensus-chart | salesforce.com, inc. Quote
The firm’s performance is also likely to have gained from its firm focus on building and expanding relationships with leading brands across industries and geographies. In addition, significant growth opportunities in the public sector are likely to have been a tailwind during the quarter under review.
Growth across all its four major cloud service offerings, Sales Cloud, Service Cloud, Platform and other plus Marketing & Commerce Cloud, is expected to have boosted Salesforce’s subscription and supported the revenue stream, which is a major catalyst.
Additionally, the acquisitions of Tableau and Vlocity are anticipated to have significantly aided the company’s top-line growth during the quarter to be reported.
Nonetheless, decline in software spending by small & medium businesses (SMBs) due to the coronavirus outbreak might have affected the company’s fiscal fourth-quarter performance.
Further, stiff competition from Oracle and Microsoft is a concern in addition to forex headwinds. Increasing investment in international expansions and data centers might have eroded the company’s profitability during the to-be-reported quarter.
What Our Model Says
Our proven model does not predict an earnings beat for Salesforce this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Salesforce currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Workday, Inc. (WDAY - Free Report) has an Earnings ESP of +1.21% and carries a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Autodesk, Inc. (ADSK - Free Report) has an Earnings ESP of +2.29% and carries a Zacks Rank of 3, currently.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +0.75% and currently holds a Zacks Rank of 3.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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