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

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Salesforce.com (CRM - Free Report) closed at $235.46 in the latest trading session, marking a +0.84% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.18%.

Heading into today, shares of the customer-management software developer had gained 13.66% over the past month, outpacing the Computer and Technology sector's gain of 9.78% and the S&P 500's gain of 6.99% in that time.

CRM will be looking to display strength as it nears its next earnings release. In that report, analysts expect CRM to post earnings of $0.88 per share. This would mark year-over-year growth of 25.71%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.88 billion, up 20.9% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.44 per share and revenue of $25.7 billion. These totals would mark changes of -30.08% and +20.94%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for CRM. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

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. Within the past 30 days, our consensus EPS projection remained stagnant. CRM is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, CRM is currently trading at a Forward P/E ratio of 67.94. Its industry sports an average Forward P/E of 40.93, so we one might conclude that CRM is trading at a premium comparatively.

We can also see that CRM currently has a PEG ratio of 3.68. 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. CRM's industry had an average PEG ratio of 2.76 as of yesterday's close.

The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 109, which puts it in the top 43% of all 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.

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


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