Down heavily in the last couple of months, investors in Salesforce (CRM) will be hoping for signs of a path to catchup with other software stocks as it delivers earnings on Wednesday that will provide a first glimpse of the company’s efforts with AI agents.
Investors Wait on Agentforce
The key focus will be on its Agentforce AI business. This platform, launched only last October, enables organizations to build, customize, and deploy autonomous AI agents for business needs like customer service or marketing.
The initial read on Agentforce’s performance will be critical to seeing whether the investment by the company can be suitably monetized. Ahead of the earnings release, Alphabet (GOOGL) agreed a $2.5 billion deal to allow Salesforce customers to run key software like Agentforce AI and Data Cloud on Google Cloud.
Analysts expect earnings per share to come in at $2.61 on revenue of $10.04 billion. Analysts at Citi, however, don’t see an immediate improvement and expect a mixed quarter from the customer relationship management software company.
Citi Left Unimpressed
Five-star Citi analyst Tyler Radke lowered the bank’s price target on Salesforce to $350 from $390 ahead of the Q4 report, while maintaining a Neutral, or Hold, rating on the stock.
Citi thinks there are mixed demand trends for Salesforce based on higher 2025 growth targets and strong Agentforce activity being offset by heavy discounts to drive adoption.
The analyst expects the company’s revenue and bookings growth to “remain constrained” in the high-single-digits, though consensus estimates for the Fiscal fourth quarter and current Fiscal 2025 first quarter seem achievable.
Looking at another name in the cloud space, Radke increased his price target for Snowflake (SNOW) to $230 from the previous $225.
Is CRM a Good Stock to Buy?
On Wall Street, analysts have a Moderate Buy consensus rating on CRM stock based on 32 Buys, seven Holds, and two Sells assigned in the past three months. The average CRM price target of $394.86 per share implies about 30% upside potential.
