SALESFORCE INC (1CRM.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1CRM - US79466L3024 - Common Stock
192.8 EUR
+0.68 (+0.35%)
Overall 1CRM gets a fundamental rating of 6 out of 10. We evaluated 1CRM against 114 industry peers in the Software industry. 1CRM has an excellent profitability rating, but there are some minor concerns on its financial health. 1CRM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year 1CRM was profitable.
- In the past year 1CRM had a positive cash flow from operations.
- Each year in the past 5 years 1CRM has been profitable.
- 1CRM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- 1CRM has a Return On Assets of 7.59%. This is in the better half of the industry: 1CRM outperforms 62.28% of its industry peers.
- The Return On Equity of 1CRM (12.03%) is comparable to the rest of the industry.
- 1CRM has a better Return On Invested Capital (10.05%) than 69.30% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for 1CRM is significantly below the industry average of 13.49%.
- The last Return On Invested Capital (10.05%) for 1CRM is above the 3 year average (5.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.59% | ||
| ROE | 12.03% | ||
| ROIC | 10.05% |
ROA(3y)3.46%
ROA(5y)3.61%
ROE(3y)5.81%
ROE(5y)5.94%
ROIC(3y)5.83%
ROIC(5y)3.79%
1.3 Margins
- 1CRM has a Profit Margin of 17.91%. This is in the better half of the industry: 1CRM outperforms 70.18% of its industry peers.
- In the last couple of years the Profit Margin of 1CRM has grown nicely.
- 1CRM's Operating Margin of 22.03% is fine compared to the rest of the industry. 1CRM outperforms 77.19% of its industry peers.
- In the last couple of years the Operating Margin of 1CRM has grown nicely.
- The Gross Margin of 1CRM (77.73%) is better than 63.16% of its industry peers.
- 1CRM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.03% | ||
| PM (TTM) | 17.91% | ||
| GM | 77.73% |
OM growth 3Y107.25%
OM growth 5Y49.51%
PM growth 3Y44.23%
PM growth 5Y85.88%
GM growth 3Y1.66%
GM growth 5Y0.52%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), 1CRM is destroying value.
- Compared to 1 year ago, 1CRM has less shares outstanding
- The number of shares outstanding for 1CRM has been increased compared to 5 years ago.
- 1CRM has a better debt/assets ratio than last year.
2.2 Solvency
- 1CRM has an Altman-Z score of 4.74. This indicates that 1CRM is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 4.74, 1CRM is in the better half of the industry, outperforming 68.42% of the companies in the same industry.
- 1CRM has a debt to FCF ratio of 0.65. This is a very positive value and a sign of high solvency as it would only need 0.65 years to pay back of all of its debts.
- 1CRM has a better Debt to FCF ratio (0.65) than 83.33% of its industry peers.
- 1CRM has a Debt/Equity ratio of 0.14. This is a healthy value indicating a solid balance between debt and equity.
- 1CRM's Debt to Equity ratio of 0.14 is fine compared to the rest of the industry. 1CRM outperforms 65.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Altman-Z | 4.74 |
ROIC/WACC0.92
WACC10.93%
2.3 Liquidity
- 1CRM has a Current Ratio of 0.98. This is a bad value and indicates that 1CRM is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Current ratio of 1CRM (0.98) is worse than 73.68% of its industry peers.
- A Quick Ratio of 0.98 indicates that 1CRM may have some problems paying its short term obligations.
- 1CRM's Quick ratio of 0.98 is on the low side compared to the rest of the industry. 1CRM is outperformed by 71.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 18.76% over the past year.
- 1CRM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.71% yearly.
- The Revenue has grown by 8.41% in the past year. This is quite good.
- 1CRM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.25% yearly.
EPS 1Y (TTM)18.76%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%34.85%
Revenue 1Y (TTM)8.41%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%8.63%
3.2 Future
- 1CRM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.75% yearly.
- Based on estimates for the next years, 1CRM will show a quite strong growth in Revenue. The Revenue will grow by 9.51% on average per year.
EPS Next Y16.58%
EPS Next 2Y14%
EPS Next 3Y13.91%
EPS Next 5Y14.75%
Revenue Next Year9.34%
Revenue Next 2Y10.17%
Revenue Next 3Y9.88%
Revenue Next 5Y9.51%
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.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- 1CRM is valuated rather expensively with a Price/Earnings ratio of 19.82.
- Based on the Price/Earnings ratio, 1CRM is valued a bit cheaper than 79.82% of the companies in the same industry.
- When comparing the Price/Earnings ratio of 1CRM to the average of the S&P500 Index (27.25), we can say 1CRM is valued slightly cheaper.
- A Price/Forward Earnings ratio of 17.23 indicates a rather expensive valuation of 1CRM.
- 78.95% of the companies in the same industry are more expensive than 1CRM, based on the Price/Forward Earnings ratio.
- 1CRM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.82 | ||
| Fwd PE | 17.23 |
4.2 Price Multiples
- 62.28% of the companies in the same industry are more expensive than 1CRM, based on the Enterprise Value to EBITDA ratio.
- Based on the Price/Free Cash Flow ratio, 1CRM is valued cheaper than 80.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.85 | ||
| EV/EBITDA | 17.28 |
4.3 Compensation for Growth
- 1CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of 1CRM may justify a higher PE ratio.
- 1CRM's earnings are expected to grow with 13.91% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.2
PEG (5Y)0.72
EPS Next 2Y14%
EPS Next 3Y13.91%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.73%, 1CRM is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 0.68, 1CRM pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, 1CRM's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1CRM pays out 21.86% of its income as dividend. This is a sustainable payout ratio.
DP21.86%
EPS Next 2Y14%
EPS Next 3Y13.91%
SALESFORCE INC / 1CRM.MI FAQ
What is the ChartMill fundamental rating of SALESFORCE INC (1CRM.MI) stock?
ChartMill assigns a fundamental rating of 6 / 10 to 1CRM.MI.
What is the valuation status for 1CRM stock?
ChartMill assigns a valuation rating of 6 / 10 to SALESFORCE INC (1CRM.MI). This can be considered as Fairly Valued.
How profitable is SALESFORCE INC (1CRM.MI) stock?
SALESFORCE INC (1CRM.MI) has a profitability rating of 7 / 10.
What is the expected EPS growth for SALESFORCE INC (1CRM.MI) stock?
The Earnings per Share (EPS) of SALESFORCE INC (1CRM.MI) is expected to grow by 16.58% in the next year.
How sustainable is the dividend of SALESFORCE INC (1CRM.MI) stock?
The dividend rating of SALESFORCE INC (1CRM.MI) is 3 / 10 and the dividend payout ratio is 21.86%.