SALESFORCE INC (CRM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CRM - US79466L3024 - Common Stock
266.08 USD
+0.82 (+0.31%)
265.01 USD
-1.07 (-0.4%)
Taking everything into account, CRM scores 6 out of 10 in our fundamental rating. CRM was compared to 276 industry peers in the Software industry. CRM scores excellent on profitability, but there are some minor concerns on its financial health. CRM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year CRM was profitable.
CRM had a positive operating cash flow in the past year.
In the past 5 years CRM has always been profitable.
CRM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of CRM (7.59%) is better than 78.06% of its industry peers.
With a decent Return On Equity value of 12.03%, CRM is doing good in the industry, outperforming 75.54% of the companies in the same industry.
CRM has a better Return On Invested Capital (10.05%) than 84.53% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CRM is below the industry average of 10.78%.
The last Return On Invested Capital (10.05%) for CRM 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
CRM has a better Profit Margin (17.91%) than 80.94% of its industry peers.
CRM's Profit Margin has improved in the last couple of years.
CRM has a Operating Margin of 22.03%. This is amongst the best in the industry. CRM outperforms 88.49% of its industry peers.
CRM's Operating Margin has improved in the last couple of years.
CRM has a better Gross Margin (77.73%) than 74.46% of its industry peers.
In the last couple of years the Gross Margin of CRM has remained more or less at the same level.
| 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
CRM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CRM has been reduced compared to 1 year ago.
Compared to 5 years ago, CRM has more shares outstanding
Compared to 1 year ago, CRM has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 5.36 indicates that CRM is not in any danger for bankruptcy at the moment.
CRM has a better Altman-Z score (5.36) than 72.66% of its industry peers.
CRM 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.
CRM has a Debt to FCF ratio of 0.65. This is in the better half of the industry: CRM outperforms 77.34% of its industry peers.
CRM has a Debt/Equity ratio of 0.14. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.14, CRM perfoms like the industry average, outperforming 49.64% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Altman-Z | 5.36 |
ROIC/WACC0.92
WACC10.87%
2.3 Liquidity
A Current Ratio of 0.98 indicates that CRM may have some problems paying its short term obligations.
CRM has a worse Current ratio (0.98) than 75.90% of its industry peers.
CRM has a Quick Ratio of 0.98. This is a bad value and indicates that CRM is not financially healthy enough and could expect problems in meeting its short term obligations.
CRM has a worse Quick ratio (0.98) than 74.82% 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 | 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.
Measured over the past years, CRM shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.71% on average per year.
Looking at the last year, CRM shows a quite strong growth in Revenue. The Revenue has grown by 8.41% in the last year.
Measured over the past years, CRM shows a quite strong growth in Revenue. The Revenue has been growing by 17.25% on average per year.
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
CRM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.63% yearly.
CRM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.37% yearly.
EPS Next Y16.58%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
EPS Next 5Y13.63%
Revenue Next Year9.34%
Revenue Next 2Y10.22%
Revenue Next 3Y9.9%
Revenue Next 5Y9.37%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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
Based on the Price/Earnings ratio of 23.10, the valuation of CRM can be described as rather expensive.
CRM's Price/Earnings ratio is a bit cheaper when compared to the industry. CRM is cheaper than 70.14% of the companies in the same industry.
When comparing the Price/Earnings ratio of CRM to the average of the S&P500 Index (26.92), we can say CRM is valued inline with the index average.
CRM is valuated rather expensively with a Price/Forward Earnings ratio of 20.24.
73.74% of the companies in the same industry are more expensive than CRM, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 23.46. CRM is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.1 | ||
| Fwd PE | 20.24 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CRM is valued a bit cheaper than the industry average as 76.98% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 79.86% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.64 | ||
| EV/EBITDA | 20.22 |
4.3 Compensation for Growth
CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CRM may justify a higher PE ratio.
A more expensive valuation may be justified as CRM's earnings are expected to grow with 13.58% in the coming years.
PEG (NY)1.39
PEG (5Y)0.83
EPS Next 2Y13.6%
EPS Next 3Y13.58%
5. Dividend
5.1 Amount
CRM has a yearly dividend return of 0.63%, which is pretty low.
Compared to an average industry Dividend Yield of 0.51, CRM pays a better dividend. On top of this CRM pays more dividend than 89.93% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.00, CRM's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
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
CRM pays out 21.86% of its income as dividend. This is a sustainable payout ratio.
DP21.86%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
266.08
+0.82 (+0.31%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners83.15%
Inst Owner Change-0.93%
Ins Owners2.53%
Ins Owner Change0.53%
Market Cap253.31B
Revenue(TTM)40.32B
Net Income(TTM)7.22B
Analysts79.31
Price Target332.22 (24.86%)
Short Float %1.78%
Short Ratio1.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
Yearly Dividend1.59
Dividend Growth(5Y)N/A
DP21.86%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.16%
Min EPS beat(2)3.73%
Max EPS beat(2)12.58%
EPS beat(4)4
Avg EPS beat(4)5.55%
Min EPS beat(4)0.37%
Max EPS beat(4)12.58%
EPS beat(8)7
Avg EPS beat(8)3.66%
EPS beat(12)11
Avg EPS beat(12)5.61%
EPS beat(16)15
Avg EPS beat(16)7.06%
Revenue beat(2)0
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-1.12%
Max Revenue beat(2)0%
Revenue beat(4)0
Avg Revenue beat(4)-0.68%
Min Revenue beat(4)-1.42%
Max Revenue beat(4)0%
Revenue beat(8)1
Avg Revenue beat(8)-0.55%
Revenue beat(12)2
Avg Revenue beat(12)-0.14%
Revenue beat(16)3
Avg Revenue beat(16)-0.22%
PT rev (1m)-1.14%
PT rev (3m)-2.83%
EPS NQ rev (1m)0.22%
EPS NQ rev (3m)0.16%
EPS NY rev (1m)3.4%
EPS NY rev (3m)3.4%
Revenue NQ rev (1m)2.47%
Revenue NQ rev (3m)2.48%
Revenue NY rev (1m)0.58%
Revenue NY rev (3m)0.59%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.1 | ||
| Fwd PE | 20.24 | ||
| P/S | 6.28 | ||
| P/FCF | 19.64 | ||
| P/OCF | 18.76 | ||
| P/B | 4.22 | ||
| P/tB | 62.19 | ||
| EV/EBITDA | 20.22 |
EPS(TTM)11.52
EY4.33%
EPS(NY)13.15
Fwd EY4.94%
FCF(TTM)13.55
FCFY5.09%
OCF(TTM)14.18
OCFY5.33%
SpS42.35
BVpS63.05
TBVpS4.28
PEG (NY)1.39
PEG (5Y)0.83
Graham Number127.84
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.59% | ||
| ROE | 12.03% | ||
| ROCE | 12.04% | ||
| ROIC | 10.05% | ||
| ROICexc | 11.87% | ||
| ROICexgc | 114.64% | ||
| OM | 22.03% | ||
| PM (TTM) | 17.91% | ||
| GM | 77.73% | ||
| FCFM | 31.98% |
ROA(3y)3.46%
ROA(5y)3.61%
ROE(3y)5.81%
ROE(5y)5.94%
ROIC(3y)5.83%
ROIC(5y)3.79%
ROICexc(3y)7.18%
ROICexc(5y)4.68%
ROICexgc(3y)84.54%
ROICexgc(5y)53.64%
ROCE(3y)6.99%
ROCE(5y)4.55%
ROICexgc growth 3Y144.43%
ROICexgc growth 5Y51.1%
ROICexc growth 3Y136.01%
ROICexc growth 5Y54.45%
OM growth 3Y107.25%
OM growth 5Y49.51%
PM growth 3Y44.23%
PM growth 5Y85.88%
GM growth 3Y1.66%
GM growth 5Y0.52%
F-Score8
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Debt/EBITDA | 0.69 | ||
| Cap/Depr | 17.92% | ||
| Cap/Sales | 1.51% | ||
| Interest Coverage | 38.61 | ||
| Cash Conversion | 110.06% | ||
| Profit Quality | 178.55% | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 5.36 |
F-Score8
WACC10.87%
ROIC/WACC0.92
Cap/Depr(3y)19.53%
Cap/Depr(5y)21.06%
Cap/Sales(3y)2.13%
Cap/Sales(5y)2.49%
Profit Quality(3y)1155.13%
Profit Quality(5y)786.34%
High Growth Momentum
Growth
EPS 1Y (TTM)18.76%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%34.85%
EPS Next Y16.58%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
EPS Next 5Y13.63%
Revenue 1Y (TTM)8.41%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%8.63%
Revenue Next Year9.34%
Revenue Next 2Y10.22%
Revenue Next 3Y9.9%
Revenue Next 5Y9.37%
EBIT growth 1Y20.93%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year41.2%
EBIT Next 3Y19.35%
EBIT Next 5Y15.55%
FCF growth 1Y46.33%
FCF growth 3Y33.02%
FCF growth 5Y27.52%
OCF growth 1Y40.37%
OCF growth 3Y29.7%
OCF growth 5Y24.76%
SALESFORCE INC / CRM FAQ
What is the ChartMill fundamental rating of SALESFORCE INC (CRM) stock?
ChartMill assigns a fundamental rating of 6 / 10 to CRM.
What is the valuation status of SALESFORCE INC (CRM) stock?
ChartMill assigns a valuation rating of 4 / 10 to SALESFORCE INC (CRM). This can be considered as Fairly Valued.
Can you provide the profitability details for SALESFORCE INC?
SALESFORCE INC (CRM) has a profitability rating of 8 / 10.
What is the expected EPS growth for SALESFORCE INC (CRM) stock?
The Earnings per Share (EPS) of SALESFORCE INC (CRM) is expected to grow by 16.58% in the next year.
Is the dividend of SALESFORCE INC sustainable?
The dividend rating of SALESFORCE INC (CRM) is 3 / 10 and the dividend payout ratio is 21.86%.