Salesforce Stock Near Crucial Support – Buy Signal?
Salesforce (CRM) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($210.50 – $232.66), levels from which it has bounced meaningfully before. In the last 10 years, Salesforce stock received buying interest at this level 6 times and subsequently went on to generate 35.7% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 8/25/2020 | 30.2% | 7 |
| 1/15/2021 | 16.6% | 32 |
| 3/10/2021 | 11.8% | 49 |
| 5/10/2021 | 44.9% | 182 |
| 11/7/2023 | 49.6% | 115 |
| 6/13/2024 | 61.1% | 174 |
Yet, a support zone alone isn’t enough; rebounds are more likely when fundamentals, sentiment, and market conditions line up. How does that look for CRM?
Rebound likely; undervalued, strong FCF, AI tailwinds.
CRM, at $220, is deeply undervalued by 42.7% per DCF analysis, while boasting robust FCF growth, expected to hit a 44.9% margin by FY2026. Despite recent stock declines (32% in one year) due to past revenue guidance misses and slowing Sales Cloud growth, analyst consensus remains a “Buy” with targets around $325. Industry tailwinds in AI-powered, autonomous CRM and integration are substantial, with Salesforce positioning with Agentforce and Slackbot. The current price reflects significant skepticism, yet underlying financial strength and future market alignment suggest upward potential. The upcoming earnings report will be a key catalyst.
- High Margins, 39% Discount: Buy Salesforce Stock Now
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- Is Salesforce Stock A Buy After Recent Decline?
- With Salesforce Stock Sliding, Have You Assessed The Risk?
- How to Get Paid to Buy CRM at a Steep Discount
- Salesforce Stock: Join the Rally at a 27% Discount
How Do CRM Financials Look Right Now?
- Revenue Growth: 8.4% LTM and 10.0% last 3-year average.
- Cash Generation: Nearly 32.0% free cash flow margin and 22.0% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for CRM was 8.4%.
- Valuation: CRM stock trades at a PE multiple of 29.1
| CRM | S&P Median | |
|---|---|---|
| Sector | Information Technology | – |
| Industry | Application Software | – |
| PE Ratio | 29.1 | 24.5 |
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| LTM* Revenue Growth | 8.4% | 6.4% |
| 3Y Average Annual Revenue Growth | 10.0% | 5.7% |
| Min Annual Revenue Growth Last 3Y | 8.4% | 0.2% |
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| LTM* Operating Margin | 22.0% | 18.8% |
| 3Y Average Operating Margin | 19.2% | 18.4% |
| LTM* Free Cash Flow Margin | 32.0% | 13.5% |
*LTM: Last Twelve Months | For more details on CRM fundamentals, read Buy or Sell CRM Stock.
And What If The Support Breaks?
CRM is not immune to deep drops despite its strong fundamentals. It fell about 70% during the Global Financial Crisis and nearly 59% in the recent inflation shock. Even the Covid pandemic and 2018 correction hit it hard, pulling the stock down around 36% and 25% respectively. Solid companies can still suffer steep losses when the market turns sour. Risk is always there, no matter how promising the story.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read CRM Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
Still not sure about CRM stock? Consider the portfolio approach.
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