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salesforce Rides on Digital Transformation, Inks Partnerships

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salesforce (CRM - Free Report) is benefiting from strong growth in its cloud-based solutions globally.

The company is gaining traction from a robust demand environment as customers are undergoing a major digital transformation. Management mentioned that digitization is driving strategic relationships of the company. Its ability to provide an integrated solution for customers’ business problems is the key driver.

Its products like Trailhead and myTrailhead are helping companies through their transformation processes as well as increasing their business scale with modern technology.

The company believes that digital transformation will consistently offer a huge growth opportunity for the entire industry.

Earlier this month, in an interview to CNBC, salesforce’s CEO Mark Benioff was quoted saying: “every company and every industry and every government [agency] is recreating themselves with their customer, so this is what’s driving our growth.”

Partnerships Perk Up Growth

salesforce has been strengthening its core competencies by pursuing strategic collaborations and acquisitions. Notably, the company’s buyout of Mulesoft has aided it to accelerate digital transformation.

Recently, the company has been chosen by the leading Japan-based property and casualty insurance provider, Tokio Marine & Nichido Fire Insurance to “unify every customer touchpoint across its corporate and sales, call centers, insurance agencies and marketing divisions onto a single CRM platform”. Tokio Marine & Nichido will be deploying salesforce to support a million of insurance agents in Japan and its 50,000 insurance agencies.

Reportedly, Tokio Marine & Nichido's digital transformation with the company includes Salesforce Financial Services Cloud, Community Cloud, Einstein Analytics, Marketing Cloud, Pardot and the Salesforce Lightning Platform.

In May, salesforce announced that a major insurance and retirement solutions company, Pacific Life, has selected it as one of its strategic technology partners for digital transformation.

On the last earnings call, management mentioned that the company has expanded its partnership deal with long-time strategic partner Dell (DELL - Free Report) in order to deliver more automated and intelligent customer service experiences with Einstein Bots.

salesforce’s ability to offer a rapid digital transformation is also helping it add several federal agencies to its clientele.

We therefore believe that the company’s initiatives in this regard will prove to be very beneficial to its top-line growth going forward.

Zacks Rank & Stocks to Consider

salesforce currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader technology sector are eGain Corporation (EGAN - Free Report) and j2 Global, Inc. (JCOM - Free Report) , each flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for eGain and j2 Global is currently projected at 30% and 8%, respectively.

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