NYSE:CRM, a strong growth stock, setting up for a breakout.

In this article, we'll take a closer look at SALESFORCE INC (NYSE:CRM) as a potential candidate for growth investing. While it's important for investors to conduct their own research, SALESFORCE INC has piqued our interest by appearing on our strong growth and breakout radar. Let's explore further.

Looking at the Growth

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NYSE:CRM boasts a 8 out of 10:

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

A Closer Look at Health for NYSE:CRM

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:CRM, the assigned 7 reflects its health status:

• CRM has an Altman-Z score of 5.65. This indicates that CRM is financially healthy and has little risk of bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 5.65, CRM is in the better half of the industry, outperforming 68.57% of the companies in the same industry.
• The Debt to FCF ratio of CRM is 0.74, which is an excellent value as it means it would take CRM, only 0.74 years of fcf income to pay off all of its debts.
• CRM's Debt to FCF ratio of 0.74 is fine compared to the rest of the industry. CRM outperforms 75.36% 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.
• 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.

Assessing Profitability 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:

• Looking at the Return On Assets, with a value of 6.11%, CRM belongs to the top of the industry, outperforming 80.71% of the companies in the same industry.
• CRM's Return On Equity of 9.77% is fine compared to the rest of the industry. CRM outperforms 80.00% of its industry peers.
• With an excellent Return On Invested Capital value of 7.71%, CRM belongs to the best of the industry, outperforming 82.14% of the companies in the same industry.
• The 3 year average ROIC (3.04%) for CRM is below the current ROIC(7.71%), indicating increased profibility in the last year.
• The Profit Margin of CRM (15.44%) is better than 82.50% of its industry peers.
• In the last couple of years the Profit Margin of CRM has grown nicely.
• CRM has a Operating Margin of 19.06%. This is amongst the best in the industry. CRM outperforms 88.21% of its industry peers.
• CRM's Operating Margin has improved in the last couple of years.
• Looking at the Gross Margin, with a value of 76.35%, CRM is in the better half of the industry, outperforming 71.43% of the companies in the same industry.

How do we evaluate the setup for NYSE:CRM?

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for NYSE:CRM is 7:

CRM has an excellent technical rating, but the quality of the setup is only medium at the moment. Price movement has been a little bit too volatile to find a nice entry and exit point. It is probably a good idea to wait for a consolidation first.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

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

For an up to date full technical analysis you can check the technical report of CRM

Disclaimer

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.