Salesforce.com (CRM) closed the most recent trading day at $257.16, moving +0.39% from the previous trading session. This change outpaced the S&P 500’s 1.16% loss on the day. Meanwhile, the Dow lost 1.16%, and the Nasdaq, a tech-heavy index, lost 0.82%.
Coming into today, shares of the customer-management software developer had gained 0.08% in the past month. In that same time, the Computer and Technology sector gained 2.54%, while the S&P 500 gained 3.87%.
Wall Street will be looking for positivity from CRM as it approaches its next earnings report date. This is expected to be December 1, 2020. The company is expected to report EPS of $0.74, down 1.33% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $5.25 billion, up 16.25% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.74 per share and revenue of $20.77 billion. These totals would mark changes of +25.08% and +21.48%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for CRM. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. 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 68.44. This valuation marks a premium compared to its industry’s average Forward P/E of 31.63.
Investors should also note that CRM has a PEG ratio of 4.37 right now. 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 2.48 based on yesterday’s closing prices.
The Computer – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 179, putting it in the bottom 30% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
To follow CRM in the coming trading sessions, be sure to utilize Zacks.com.
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