SALESFORCE INC (CRM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CRM - US79466L3024 - Common Stock
259.4 USD
-0.54 (-0.21%)
258.5 USD
-0.9 (-0.35%)
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. While CRM has a great profitability rating, there are some minor concerns on its financial health. CRM has a decent growth rate and is not valued too expensively.
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.
Each year in the past 5 years CRM had a positive operating cash flow.
1.2 Ratios
CRM has a Return On Assets of 7.59%. This is in the better half of the industry: CRM outperforms 77.90% of its industry peers.
CRM has a Return On Equity of 12.03%. This is in the better half of the industry: CRM outperforms 75.72% of its industry peers.
CRM's Return On Invested Capital of 10.05% is amongst the best of the industry. CRM outperforms 84.78% 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 3 year average ROIC (5.83%) for CRM is below the current ROIC(10.05%), indicating increased profibility in the last year.
| 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
With an excellent Profit Margin value of 17.91%, CRM belongs to the best of the industry, outperforming 80.43% of the companies in the same industry.
In the last couple of years the Profit Margin of CRM has grown nicely.
CRM has a better Operating Margin (22.03%) than 88.41% of its industry peers.
In the last couple of years the Operating Margin of CRM has grown nicely.
CRM has a better Gross Margin (77.73%) than 75.00% of its industry peers.
CRM'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), CRM is destroying value.
Compared to 1 year ago, CRM has less shares outstanding
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 5.26 indicates that CRM is not in any danger for bankruptcy at the moment.
CRM has a better Altman-Z score (5.26) than 73.19% of its industry peers.
The Debt to FCF ratio of CRM is 0.65, which is an excellent value as it means it would take CRM, only 0.65 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 0.65, CRM is doing good in the industry, outperforming 77.54% of the companies in the same industry.
A Debt/Equity ratio of 0.14 indicates that CRM is not too dependend on debt financing.
CRM's Debt to Equity ratio of 0.14 is in line compared to the rest of the industry. CRM outperforms 49.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.65 | ||
| Altman-Z | 5.26 |
ROIC/WACC0.92
WACC10.9%
2.3 Liquidity
CRM has a Current 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 Current ratio of 0.98. This is in the lower half of the industry: CRM underperforms 75.72% of its industry peers.
A Quick Ratio of 0.98 indicates that CRM may have some problems paying its short term obligations.
CRM has a Quick ratio of 0.98. This is in the lower half of the industry: CRM underperforms 74.64% of its industry peers.
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.
| 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.
CRM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.71% yearly.
CRM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.41%.
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
The Earnings Per Share is expected to grow by 14.75% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.51% on average over the next years. This is quite good.
EPS Next Y16.58%
EPS Next 2Y13.6%
EPS Next 3Y13.58%
EPS Next 5Y14.75%
Revenue Next Year9.34%
Revenue Next 2Y10.22%
Revenue Next 3Y9.9%
Revenue Next 5Y9.51%
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
A Price/Earnings ratio of 22.52 indicates a rather expensive valuation of CRM.
Compared to the rest of the industry, the Price/Earnings ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 71.74% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of CRM to the average of the S&P500 Index (27.25), we can say CRM is valued inline with the index average.
The Price/Forward Earnings ratio is 19.73, which indicates a rather expensive current valuation of CRM.
75.00% of the companies in the same industry are more expensive than CRM, based on the Price/Forward Earnings ratio.
CRM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.52 | ||
| Fwd PE | 19.73 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 77.90% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, CRM is valued cheaply inside the industry as 80.07% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.15 | ||
| EV/EBITDA | 19.75 |
4.3 Compensation for Growth
The 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.
CRM's earnings are expected to grow with 13.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.36
PEG (5Y)0.81
EPS Next 2Y13.6%
EPS Next 3Y13.58%
5. Dividend
5.1 Amount
CRM has a yearly dividend return of 0.64%, which is pretty low.
CRM's Dividend Yield is rather good when compared to the industry average which is at 0.52. CRM pays more dividend than 89.49% of the companies in the same industry.
With a Dividend Yield of 0.64, CRM pays less dividend than the S&P500 average, which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
CRM does not have a reliable dividend history as it only pays dividend since a couple or years.
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%
259.4
-0.54 (-0.21%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners84.48%
Inst Owner Change-0.06%
Ins Owners2.57%
Ins Owner Change-0.09%
Market Cap246.95B
Revenue(TTM)40.32B
Net Income(TTM)7.22B
Analysts79.66
Price Target332.22 (28.07%)
Short Float %1.73%
Short Ratio2.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
Yearly Dividend1.59
Dividend Growth(5Y)N/A
DP21.86%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
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)0.55%
PT rev (3m)-2.89%
EPS NQ rev (1m)0.05%
EPS NQ rev (3m)0.19%
EPS NY rev (1m)3.42%
EPS NY rev (3m)3.4%
Revenue NQ rev (1m)0.36%
Revenue NQ rev (3m)2.48%
Revenue NY rev (1m)0.58%
Revenue NY rev (3m)0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.52 | ||
| Fwd PE | 19.73 | ||
| P/S | 6.13 | ||
| P/FCF | 19.15 | ||
| P/OCF | 18.29 | ||
| P/B | 4.11 | ||
| P/tB | 60.63 | ||
| EV/EBITDA | 19.75 |
EPS(TTM)11.52
EY4.44%
EPS(NY)13.15
Fwd EY5.07%
FCF(TTM)13.55
FCFY5.22%
OCF(TTM)14.18
OCFY5.47%
SpS42.35
BVpS63.05
TBVpS4.28
PEG (NY)1.36
PEG (5Y)0.81
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 | 5.26 |
F-Score8
WACC10.9%
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 5Y14.75%
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 5Y9.51%
EBIT growth 1Y20.93%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year41.2%
EBIT Next 3Y19.35%
EBIT Next 5Y14.79%
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 for CRM stock?
ChartMill assigns a valuation rating of 5 / 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 valuation of SALESFORCE INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for SALESFORCE INC (CRM) is 22.52 and the Price/Book (PB) ratio is 4.11.
How financially healthy is SALESFORCE INC?
The financial health rating of SALESFORCE INC (CRM) is 6 / 10.