SALESFORCE INC (CRM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CRM - US79466L3024 - Common Stock
260.57 USD
+13.11 (+5.3%)
260.75 USD
+0.18 (+0.07%)
Taking everything into account, CRM scores 7 out of 10 in our fundamental rating. CRM was compared to 281 industry peers in the Software industry. Both the health and profitability get an excellent rating, making CRM a very profitable company, without any liquidiy or solvency issues. CRM has a correct valuation and a medium growth rate. This makes CRM very considerable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year CRM was profitable.
CRM had a positive operating cash flow in the past year.
CRM had positive earnings in each of the past 5 years.
In the past 5 years CRM always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 6.83%, CRM is doing good in the industry, outperforming 75.80% of the companies in the same industry.
CRM has a Return On Equity of 10.86%. This is in the better half of the industry: CRM outperforms 75.44% of its industry peers.
CRM's Return On Invested Capital of 9.32% is amongst the best of the industry. CRM outperforms 83.27% of its industry peers.
CRM had an Average Return On Invested Capital over the past 3 years of 5.83%. This is significantly below the industry average of 12.03%.
The last Return On Invested Capital (9.32%) for CRM is above the 3 year average (5.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.83% | ||
| ROE | 10.86% | ||
| ROIC | 9.32% |
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
Looking at the Profit Margin, with a value of 16.87%, CRM belongs to the top of the industry, outperforming 80.78% of the companies in the same industry.
CRM's Profit Margin has improved in the last couple of years.
CRM has a Operating Margin of 21.22%. This is amongst the best in the industry. CRM outperforms 87.19% of its industry peers.
In the last couple of years the Operating Margin of CRM has grown nicely.
CRM's Gross Margin of 77.65% is fine compared to the rest of the industry. CRM outperforms 74.02% 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 | 21.22% | ||
| PM (TTM) | 16.87% | ||
| GM | 77.65% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CRM is destroying value.
The number of shares outstanding for CRM has been reduced compared to 1 year ago.
The number of shares outstanding for CRM has been increased compared to 5 years ago.
CRM has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.89 indicates that CRM is not in any danger for bankruptcy at the moment.
The Altman-Z score of CRM (4.89) is better than 70.46% of its industry peers.
CRM has a debt to FCF ratio of 0.68. This is a very positive value and a sign of high solvency as it would only need 0.68 years to pay back of all of its debts.
CRM's Debt to FCF ratio of 0.68 is fine compared to the rest of the industry. CRM outperforms 78.29% 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.
CRM has a Debt to Equity ratio (0.14) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.68 | ||
| Altman-Z | 4.89 |
ROIC/WACC0.86
WACC10.78%
2.3 Liquidity
CRM has a Current Ratio of 1.12. This is a normal value and indicates that CRM is financially healthy and should not expect problems in meeting its short term obligations.
CRM has a Current ratio of 1.12. This is in the lower half of the industry: CRM underperforms 69.04% of its industry peers.
A Quick Ratio of 1.12 indicates that CRM should not have too much problems paying its short term obligations.
CRM's Quick ratio of 1.12 is on the low side compared to the rest of the industry. CRM is outperformed by 67.62% 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 | 1.12 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 18.76% over the past year.
The Earnings Per Share has been growing by 27.71% on average over the past years. This is a very strong growth
CRM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.72%.
The Revenue has been growing by 17.25% on average over the past years. This is quite good.
EPS 1Y (TTM)18.76%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%34.85%
Revenue 1Y (TTM)8.72%
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.
The Revenue is expected to grow by 9.37% on average over the next years. This is quite good.
EPS Next Y12.73%
EPS Next 2Y12.3%
EPS Next 3Y12.79%
EPS Next 5Y13.63%
Revenue Next Year8.71%
Revenue Next 2Y8.86%
Revenue Next 3Y8.97%
Revenue Next 5Y9.37%
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
Based on the Price/Earnings ratio of 22.62, the valuation of CRM can be described as rather expensive.
72.95% of the companies in the same industry are more expensive than CRM, based on the Price/Earnings ratio.
CRM is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.46, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 20.28, CRM is valued on the expensive side.
CRM's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CRM is cheaper than 74.73% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CRM to the average of the S&P500 Index (36.10), we can say CRM is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.62 | ||
| Fwd PE | 20.28 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CRM is valued cheaply inside the industry as 80.07% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, CRM is valued cheaply inside the industry as 80.43% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.85 | ||
| EV/EBITDA | 19.06 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CRM has an outstanding profitability rating, which may justify a higher PE ratio.
CRM's earnings are expected to grow with 12.79% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.78
PEG (5Y)0.82
EPS Next 2Y12.3%
EPS Next 3Y12.79%
5. Dividend
5.1 Amount
CRM has a yearly dividend return of 0.70%, which is pretty low.
Compared to an average industry Dividend Yield of 59.20, CRM pays a better dividend. On top of this CRM pays more dividend than 89.68% of the companies listed in the same industry.
With a Dividend Yield of 0.70, CRM pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
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 23.50% of its income as dividend. This is a sustainable payout ratio.
DP23.5%
EPS Next 2Y12.3%
EPS Next 3Y12.79%
260.57
+13.11 (+5.3%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners83.17%
Inst Owner Change-0.96%
Ins Owners2.53%
Ins Owner Change0.52%
Market Cap248.06B
Revenue(TTM)37.90B
Net Income(TTM)6.66B
Analysts79.31
Price Target336.05 (28.97%)
Short Float %1.91%
Short Ratio2.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.7% |
Yearly Dividend1.59
Dividend Growth(5Y)N/A
DP23.5%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.05%
Min EPS beat(2)0.37%
Max EPS beat(2)3.73%
EPS beat(4)3
Avg EPS beat(4)1.83%
Min EPS beat(4)-2.3%
Max EPS beat(4)5.52%
EPS beat(8)7
Avg EPS beat(8)2.26%
EPS beat(12)11
Avg EPS beat(12)5.73%
EPS beat(16)15
Avg EPS beat(16)8.56%
Revenue beat(2)0
Avg Revenue beat(2)-0.08%
Min Revenue beat(2)-0.16%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-0.39%
Min Revenue beat(4)-1.42%
Max Revenue beat(4)0.02%
Revenue beat(8)1
Avg Revenue beat(8)-0.53%
Revenue beat(12)2
Avg Revenue beat(12)-0.12%
Revenue beat(16)3
Avg Revenue beat(16)-0.15%
PT rev (1m)-1.78%
PT rev (3m)-5.38%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.4%
EPS NY rev (1m)0%
EPS NY rev (3m)0.55%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.17%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.62 | ||
| Fwd PE | 20.28 | ||
| P/S | 6.28 | ||
| P/FCF | 19.85 | ||
| P/OCF | 18.84 | ||
| P/B | 4.04 | ||
| P/tB | 39.88 | ||
| EV/EBITDA | 19.06 |
EPS(TTM)11.52
EY4.42%
EPS(NY)12.85
Fwd EY4.93%
FCF(TTM)13.13
FCFY5.04%
OCF(TTM)13.83
OCFY5.31%
SpS41.49
BVpS64.42
TBVpS6.53
PEG (NY)1.78
PEG (5Y)0.82
Graham Number129.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.83% | ||
| ROE | 10.86% | ||
| ROCE | 11.17% | ||
| ROIC | 9.32% | ||
| ROICexc | 11.72% | ||
| ROICexgc | 153.28% | ||
| OM | 21.22% | ||
| PM (TTM) | 16.87% | ||
| GM | 77.65% | ||
| FCFM | 31.64% |
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-Score9
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.68 | ||
| Debt/EBITDA | 0.72 | ||
| Cap/Depr | 20.05% | ||
| Cap/Sales | 1.7% | ||
| Interest Coverage | 36.44 | ||
| Cash Conversion | 112.25% | ||
| Profit Quality | 187.56% | ||
| Current Ratio | 1.12 | ||
| Quick Ratio | 1.12 | ||
| Altman-Z | 4.89 |
F-Score9
WACC10.78%
ROIC/WACC0.86
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 Y12.73%
EPS Next 2Y12.3%
EPS Next 3Y12.79%
EPS Next 5Y13.63%
Revenue 1Y (TTM)8.72%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%8.63%
Revenue Next Year8.71%
Revenue Next 2Y8.86%
Revenue Next 3Y8.97%
Revenue Next 5Y9.37%
EBIT growth 1Y20.59%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year38.23%
EBIT Next 3Y16.28%
EBIT Next 5Y15.55%
FCF growth 1Y65.28%
FCF growth 3Y33.02%
FCF growth 5Y27.52%
OCF growth 1Y56.77%
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 7 / 10 to CRM.
What is the valuation status of SALESFORCE INC (CRM) stock?
ChartMill assigns a valuation rating of 6 / 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 12.73% 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 23.5%.