SALESFORCE INC (CRM)
US79466L3024 - Common Stock
Overall CRM gets a fundamental rating of 7 out of 10. We evaluated CRM against 277 industry peers in the Software industry. CRM has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CRM is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! These ratings would make CRM suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year CRM was profitable.
In the past year CRM had a positive cash flow from operations.
In the past 5 years CRM has always been profitable.
In the past 5 years CRM always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 4.14%, CRM is doing good in the industry, outperforming 76.45% of the companies in the same industry.
With a decent Return On Equity value of 6.93%, CRM is doing good in the industry, outperforming 77.90% of the companies in the same industry.
CRM's Return On Invested Capital of 6.48% is amongst the best of the industry. CRM outperforms 82.97% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CRM is significantly below the industry average of 10.19%.
The 3 year average ROIC (3.04%) for CRM is below the current ROIC(6.48%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.14% | ||
| ROE | 6.93% | ||
| ROIC | 6.48% |
ROA(3y)1.96%
ROA(5y)2.45%
ROE(3y)3.26%
ROE(5y)3.99%
ROIC(3y)3.04%
ROIC(5y)2.16%
1.3 Margins
The Profit Margin of CRM (11.87%) is better than 82.25% of its industry peers.
CRM's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 17.21%, CRM belongs to the top of the industry, outperforming 87.68% of the companies in the same industry.
CRM's Operating Margin has improved in the last couple of years.
CRM's Gross Margin of 75.50% is fine compared to the rest of the industry. CRM outperforms 69.93% of its industry peers.
CRM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.21% | ||
| PM (TTM) | 11.87% | ||
| GM | 75.5% |
OM growth 3Y100.32%
OM growth 5Y32.39%
PM growth 3Y-14.76%
PM growth 5Y7.26%
GM growth 3Y0.48%
GM growth 5Y0.4%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CRM is destroying value.
Compared to 1 year ago, CRM has less shares outstanding
Compared to 5 years ago, CRM has more shares outstanding
CRM has a better debt/assets ratio than last year.
2.2 Solvency
CRM has an Altman-Z score of 4.86. This indicates that CRM is financially healthy and has little risk of bankruptcy at the moment.
CRM has a better Altman-Z score (4.86) than 68.12% of its industry peers.
CRM has a debt to FCF ratio of 0.99. This is a very positive value and a sign of high solvency as it would only need 0.99 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 0.99, CRM is doing good in the industry, outperforming 76.09% of the companies in the same industry.
CRM has a Debt/Equity ratio of 0.14. This is a healthy value indicating a solid balance between debt and equity.
CRM has a Debt to Equity ratio (0.14) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.99 | ||
| Altman-Z | 4.86 |
ROIC/WACC0.66
WACC9.77%
2.3 Liquidity
CRM has a Current Ratio of 1.09. This is a normal value and indicates that CRM is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.09, CRM is not doing good in the industry: 72.46% of the companies in the same industry are doing better.
A Quick Ratio of 1.09 indicates that CRM should not have too much problems paying its short term obligations.
CRM has a Quick ratio of 1.09. This is in the lower half of the industry: CRM underperforms 71.01% of its industry peers.
CRM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 56.38% over the past year.
Measured over the past years, CRM shows a very strong growth in Earnings Per Share. The EPS has been growing by 26.05% on average per year.
The Revenue has grown by 11.18% in the past year. This is quite good.
Measured over the past years, CRM shows a very strong growth in Revenue. The Revenue has been growing by 21.28% on average per year.
EPS 1Y (TTM)56.38%
EPS 3Y18.61%
EPS 5Y26.05%
EPS growth Q2Q36.31%
Revenue 1Y (TTM)11.18%
Revenue growth 3Y17.93%
Revenue growth 5Y21.28%
Revenue growth Q2Q10.77%
3.2 Future
The Earnings Per Share is expected to grow by 13.53% on average over the next years. This is quite good.
CRM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.92% yearly.
EPS Next Y20.09%
EPS Next 2Y16.35%
EPS Next 3Y17.19%
EPS Next 5Y13.53%
Revenue Next Year9.15%
Revenue Next 2Y9.83%
Revenue Next 3Y10.49%
Revenue Next 5Y9.92%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 34.79 indicates a quite expensive valuation of CRM.
Compared to the rest of the industry, the Price/Earnings ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 71.01% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 28.15. CRM is valued slightly more expensive when compared to this.
The Price/Forward Earnings ratio is 28.97, which means the current valuation is very expensive for CRM.
Based on the Price/Forward Earnings ratio, CRM is valued a bit cheaper than 67.39% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.20. CRM is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.79 | ||
| Fwd PE | 28.97 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CRM indicates a rather cheap valuation: CRM is cheaper than 80.07% of the companies listed in the same industry.
76.45% of the companies in the same industry are more expensive than CRM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.11 | ||
| EV/EBITDA | 26.62 |
4.3 Compensation for Growth
CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CRM has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as CRM's earnings are expected to grow with 17.19% in the coming years.
PEG (NY)1.73
PEG (5Y)1.34
EPS Next 2Y16.35%
EPS Next 3Y17.19%
5. Dividend
5.1 Amount
With a yearly dividend of 0.56%, CRM is not a good candidate for dividend investing.
CRM's Dividend Yield is rather good when compared to the industry average which is at 12.75. CRM pays more dividend than 91.67% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.33, CRM's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.56% |
5.2 History
CRM is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y16.35%
EPS Next 3Y17.19%
SALESFORCE INC
NYSE:CRM (5/17/2024, 7:04:00 PM)
After market: 285.42 -0.19 (-0.07%)285.61
+0.93 (+0.33%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
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Market Cap276.47B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.56% |
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Surprises & Revisions
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.79 | ||
| Fwd PE | 28.97 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
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PEG (NY)1.73
PEG (5Y)1.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.14% | ||
| ROE | 6.93% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 17.21% | ||
| PM (TTM) | 11.87% | ||
| GM | 75.5% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
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ROICexc(3y)
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ROICexcg growth 5Y
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F-Score
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
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Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)56.38%
EPS 3Y18.61%
EPS 5Y
EPS growth Q2Q
EPS Next Y20.09%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)11.18%
Revenue growth 3Y17.93%
Revenue growth 5Y
Revenue growth Q2Q
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Revenue Next 3Y
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