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In the latest trading session, Salesforce.com (CRM) closed at $278.23, marking a +1.78% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.44%. Meanwhile, the Dow experienced a rise of 0.7%, and the technology-dominated Nasdaq saw an increase of 0.27%.
Prior to today's trading, shares of the customer-management software developer had gained 12.04% over the past month. This has lagged the Computer and Technology sector's gain of 15.87% and outpaced the S&P 500's gain of 10.62% in that time.
The investment community will be paying close attention to the earnings performance of Salesforce.com in its upcoming release. The company's earnings per share (EPS) are projected to be $2.54, reflecting a 4.1% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $9.74 billion, indicating a 6.61% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $11.11 per share and a revenue of $40.75 billion, demonstrating changes of +8.92% and +7.53%, respectively, from the preceding year.
Investors might also notice recent changes to analyst estimates for Salesforce.com. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.17% lower within the past month. Salesforce.com presently features a Zacks Rank of #3 (Hold).
Looking at valuation, Salesforce.com is presently trading at a Forward P/E ratio of 24.6. Its industry sports an average Forward P/E of 26.45, so one might conclude that Salesforce.com is trading at a discount comparatively.
Investors should also note that CRM has a PEG ratio of 1.94 right now. 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 2.28 as of yesterday's close.