Why NYSE:CRM Is a Standout High-Growth Stock in a Consolidation Phase.

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if SALESFORCE INC (NYSE:CRM) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted SALESFORCE INC showing up in our growth with base formation screen, so it may be worth spending some more time on it.

Growth Assessment of NYSE:CRM

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NYSE:CRM scores a 8 out of 10:

• CRM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 36.43%, which is quite impressive.
• The Earnings Per Share has been growing by 26.05% on average over the past years. This is a very strong growth
• The Revenue has grown by 10.26% in the past year. This is quite good.
• CRM shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 21.28% yearly.
• The Earnings Per Share is expected to grow by 14.63% on average over the next years. This is quite good.
• The Revenue is expected to grow by 10.16% on average over the next years. This is quite good.

Assessing Health for NYSE:CRM

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:CRM was assigned a score of 7 for health:

• An Altman-Z score of 5.09 indicates that CRM is not in any danger for bankruptcy at the moment.
• CRM has a Altman-Z score of 5.09. This is in the better half of the industry: CRM outperforms 66.90% of its industry peers.
• CRM has a debt to FCF ratio of 0.74. This is a very positive value and a sign of high solvency as it would only need 0.74 years to pay back of all of its debts.
• CRM has a Debt to FCF ratio of 0.74. This is in the better half of the industry: CRM outperforms 75.00% of its industry peers.
• CRM has a Debt/Equity ratio of 0.15. This is a healthy value indicating a solid balance between debt and equity.
• The current and quick ratio evaluation for CRM is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Profitability Analysis for NYSE:CRM

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:CRM, the assigned 8 is noteworthy for profitability:

• The Return On Assets of CRM (6.11%) is better than 80.99% of its industry peers.
• Looking at the Return On Equity, with a value of 9.77%, CRM belongs to the top of the industry, outperforming 80.28% of the companies in the same industry.
• The Return On Invested Capital of CRM (7.71%) is better than 82.39% of its industry peers.
• The last Return On Invested Capital (7.71%) for CRM is above the 3 year average (3.04%), which is a sign of increasing profitability.
• CRM's Profit Margin of 15.44% is amongst the best of the industry. CRM outperforms 83.10% of its industry peers.
• In the last couple of years the Profit Margin of CRM has grown nicely.
• Looking at the Operating Margin, with a value of 19.06%, CRM belongs to the top of the industry, outperforming 88.38% of the companies in the same industry.
• In the last couple of years the Operating Margin of CRM has grown nicely.
• CRM's Gross Margin of 76.35% is fine compared to the rest of the industry. CRM outperforms 71.48% of its industry peers.

How does the Setup look for NYSE:CRM

ChartMill takes into account not only the Technical Rating but also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, NYSE:CRM exhibits a 7 setup rating, indicating its consolidation status in recent days and weeks.

CRM has a bad technical rating, but it does show a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 255.37. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 248.82, a Stop Loss order could be placed below this zone.

More Strong Growth stocks can be found in our Strong Growth screener.

Our latest full fundamental report of CRM contains the most current fundamental analsysis.

Our latest full technical report of CRM contains the most current technical analsysis.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.