American cloud-based software company Salesforce (NYSE:CRM) surprised investors by announcing that it is hiring 3,300 people after laying off thousands earlier this year. CEO Marc Benioff broke the news at the company’s annual Dreamforce conference on September 14. The hiring will occur in Salesforce’s sales, engineering, and cloud departments.
In January, CRM announced the layoff of 10% of its workforce, totaling roughly 8,000 employees. Benioff stated that many of the new postings will be “boomerangs,” meaning re-hiring ex-employees who left for other jobs. The CEO also added that the management needs to hire “thousands” of employees to accomplish the company’s goal, which is to “grow the company and to continue to achieve great margins.”
Several tech companies have resorted to job cuts as cost-cutting initiatives after rapid pandemic hiring led to overstaffing. Even so, Salesforce’s latest news could spark a new wave of tech hiring. CRM is also eyeing a larger chunk of the artificial intelligence (AI) market. Recently, it announced the launch of its generative AI tool, Einstein Copilot, which is available across many of its apps.
Interestingly, as per a regulatory filing, CEO Benioff sold $3.29 million worth of CRM stock on September 13, a day before he announced the hiring plans. The uninformative sales took place in multiple tranches at average sale prices ranging between $218.91 and $221.53. This is the CEO’s fifth automated share sale in the past seven days.
Is CRM Stock a Good Buy Now?
Yesterday, three analysts reiterated their Buy rating on Salesforce stock. Out of these, Goldman Sachs analyst Kash Rangan has the highest price target of $340 (55.4% upside) on CRM. However, Wall Street remains cautiously optimistic about Salesforce’s stock trajectory.
Of the 28 Top Analysts who recently rated CRM stock, 17 have given it a Buy rating, 10 have given it a Hold rating, and one analyst has given the stock a Sell rating. Top Wall Street analysts are those awarded higher stars by the TipRanks Star Ranking System. This is based on an analyst’s success rate, average return per rating, and statistical significance (number of ratings).
Based on these views, CRM has a Moderate Buy consensus rating on TipRanks. Also, the average Salesforce price forecast of $251.44 implies 14.9% upside potential from current levels. Year-to-date, CRM stock has gained 63.3%, thanks to the overall bullish sentiment toward tech stocks.
