Customer relationship management company Salesforce (CRM) is set to report its results for the third quarter of Fiscal 2025 after the market closes on Tuesday, December 3. CRM shares have surged nearly 26% year-to-date, backed by customer enthusiasm and solid demand expectations for its artificial intelligence (AI) platform, Agentforce.
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The Street expects Salesforce to report adjusted earnings per share (EPS) of $2.44, higher than the $2.11 reported last year. Also, revenue is pegged at $9.35 billion, up 7.2% compared to Q3 FY24.
Interestingly, Salesforce has exceeded earnings expectations for eight consecutive quarters. CRM shares slipped about 20% on Q1 FY25 revenue miss. However, shares gained momentum after the launch of the company’s Agentforce suite of products in September, zooming over 33%.
Analysts Divided Ahead of CRM’s Q3 Print
Ahead of CRM’s Q3 print, analysts remain divided on Salesforce stock. In the last ten days leading to earnings, 15 analysts have revisited their views on CRM stock, with three giving a Hold rating and remaining a Buy rating. Importantly, eight analysts have lifted their price targets on the stock in anticipation that the company will deliver robust results.
Recently, Citi analyst Tyler Radke lifted the price target to $368 from $290, implying 11.5% upside potential. Radke maintained a Hold rating on CRM since he sees Salesforce’s revenue and bookings growth to remain in the high-single digits. Having said that, the analyst believes CRM’s Q3 and Q4 expectations are achievable.
Meanwhile, Morgan Stanley analyst Keith Weiss kept a Buy rating with a $330 price target, which implies shares are almost fully valued at current levels. The five-star analyst believes that the expectations from Agentforce are already built into the price, especially with the product being in the early stages. Weiss awaits proof-of-concept from the product usage and predicts that revenue contributions will begin only in the second half of the calendar year 2025.
Options Traders Anticipate a Major Move
TipRanks’ Options tool offers a quick way to gauge what options traders anticipate from the stock following its earnings report. The expected earnings move is calculated using the at-the-money straddle of the options set to expire closest to the announcement. While this may sound complex, the tool handles the calculations for you.
Currently, it indicates that options traders are predicting about a 7.18% swing in either direction in CRM stock.
Is CRM a Good Buy Right Now?
As discussed above, analysts are cautiously optimistic about Salesforce’s stock trajectory. On TipRanks, CRM stock has a Moderate Buy consensus rating based on 27 Buys, seven Holds, and one Sell rating. The average Salesforce price target of $360.45 implies 9.2% upside potential from current levels.
