NYSE:CRM is showing good growth, while it is not too expensive.

Last update: Nov 4, 2024

Our stock screener has spotted SALESFORCE INC (NYSE:CRM) as a growth stock which is not overvalued. NYSE:CRM is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

What does the Growth looks like for NYSE:CRM

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:CRM has achieved a 8 out of 10:

The Earnings Per Share has grown by an impressive 36.43% over the past year.
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.
CRM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.16% yearly.

Analyzing Valuation Metrics

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:CRM has received a 5 out of 10:

Compared to the rest of the industry, the Price/Earnings ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 70.82% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 70.11% of the companies listed in the same industry.
75.09% of the companies in the same industry are more expensive than CRM, based on the Enterprise Value to EBITDA ratio.
CRM's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CRM is cheaper than 79.72% of the companies in the same industry.
CRM has an outstanding profitability rating, which may justify a higher PE ratio.
CRM's earnings are expected to grow with 15.93% in the coming years. This may justify a more expensive valuation.

Health Analysis for NYSE:CRM

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:CRM, the assigned 7 for health provides valuable insights:

CRM has an Altman-Z score of 5.76. This indicates that CRM is financially healthy and has little risk of bankruptcy at the moment.
CRM has a Altman-Z score of 5.76. This is in the better half of the industry: CRM outperforms 69.39% of its industry peers.
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 has a Debt to FCF ratio of 0.74. This is in the better half of the industry: CRM outperforms 76.87% of its industry peers.
A Debt/Equity ratio of 0.15 indicates that CRM is not too dependend on debt financing.
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.

Looking at the Profitability

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NYSE:CRM, the assigned 8 is a significant indicator of profitability:

The Return On Assets of CRM (6.11%) is better than 79.72% of its industry peers.
CRM's Return On Equity of 9.77% is amongst the best of the industry. CRM outperforms 80.07% of its industry peers.
CRM's Return On Invested Capital of 7.71% is amongst the best of the industry. CRM outperforms 82.21% 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.
With an excellent Profit Margin value of 15.44%, CRM belongs to the best of the industry, outperforming 82.56% of the companies in the same industry.
CRM's Profit Margin has improved in the last couple of years.
CRM's Operating Margin of 19.06% is amongst the best of the industry. CRM outperforms 87.90% of its industry peers.
In the last couple of years the Operating Margin of CRM has grown nicely.
CRM has a Gross Margin of 76.35%. This is in the better half of the industry: CRM outperforms 71.53% of its industry peers.

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

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

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.