Cloud-based software company Salesforce (NYSE:CRM) has been witnessing a rough patch in 2022. Macroeconomic headwinds, unfavorable currency movements, and overall market pessimism have weighed on the stock’s shares so far. However, the company is leaving no stone unturned to boost its business growth by widening its portfolio and growing inorganically. According to the TipRanks tool, bullish financial bloggers and retail investors also paint a positive outlook on the stock.
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Salesforce Looks Unstoppable
Salesforce is a formidable name as a Customer Relationship Management (CRM) player in the Software-as-a-Service (SaaS) enterprise application market. The California-based company boasts a solid record of an earnings beat. Salesforce has successfully delivered an earnings surprise in all the trailing quarters in the last couple of years. If the trend persists, it can provide strong support to its share price performance in the coming quarters.
The cloud-based software company has been riding solid demand levels as customers remain inclined toward digital transformation. Backed by these factors, Salesforce’s Fiscal Q2-2023 earnings results were impressive. Both revenue and earnings per share (EPS) beat analysts’ estimates.
Another factor that boosts Salesforce’s capacity to weather tough market conditions is its mammoth balance sheet. The company flaunted cash and cash equivalents of over $13.5 billion as of July end. This cash-rich company can undertake projects to accelerate its organic and inorganic growth and undertake capital deployment initiatives. It doesn’t come as a surprise that Salesforce announced a new share repurchase program worth $10 billion with the recently reported quarterly results.
However, the company slashed its Fiscal 2023 earnings and revenue guidance largely due to macroeconomic uncertainties and unfavorable currency movements. This highlights a little bumpy road ahead. For Fiscal 2023, adjusted EPS is projected in the range of $4.71-$4.73, and revenue is expected to come between $30.9 billion and $31 billion, implying a 20% growth.
What Is the Target Price for Salesforce Stock?
CRM stock’s average price target of $225.19, implies a 43.5% upside potential from the current levels. Moreover, CRM stock looks like a great investment option to park your money. Wall Street is optimistic about the prospects of CRM stock and has a Strong Buy consensus rating based on 29 Buys, and four Holds.
Further, financial bloggers are 85% bullish on CRM stock, compared to the sector average of 65%. As per TipRanks, retail investors, too, look bullish on the stock, as they increased their holdings in CRM stock by 2.5% in the last 30 days.
Conclusion: CRM Has Bright Prospects
Salesforce stock seems to have the potential to turn around the 38.6% decline in its shares so far in 2022. In expanding its offerings, the company recently introduced the next generation of MuleSoft, Customer 360 innovations, and Tableau Cloud. Inorganically, Salesforce is gaining on the growing popularity of Slack among its customer base as the company expects a $1.5 billion top-line contribution from Slack in Fiscal 2023.
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