Salesforce (CRM) was once the king of the high-growth cloud stocks - with over 25 % sales growth per year. But times have changed.
Growth is slowing, the valuation looks ambitious - and the market is asking itself a key question:
What's next for Salesforce?
Less growth, more profitability
- Previously: >25% revenue growth (e.g. 2018)
- Today: Forecast at only approx. 9 %
But: while growth is slowing, margins are increasing. Salesforce has abandoned the strategy of "growth at any price" and is now focusing on profitable growth:
- Major acquisitions paused
- Focus on efficiency
- Operating margin: now 16 % (previously close to zero)
However, the market has not yet fully priced in this not yet fully priced in.
🧠 Market remains cautious
Despite positive quarterly figures, the share price reaction often remains subdued. The share tends to move sideways or fall slightly - a sign that investors are uncertainwhether Salesforce will be able to boost growth again.
🤖 AgentForce: Salesforce's AI bet
A beacon of hope is AgentForce - the new AI suite from Salesforce:
- Utilizes CRM data + AI prompts
- Automates sales and customer processes
- Saves time & improves decision making
- Makes the product "stickier" and expands the addressable market
If AgentForce is successful, it could unleash new growth potential - and put Salesforce ahead in the AI race.
🔄 M&A remains part of the strategy
Salesforce is known for large acquisitions:
- Slack: Integration successful, but financially disappointing
- MuleSoft: Successful in the API sector
- Tableau: Strengthens data and visualization capabilities
Next step: Planned USD 8 billion acquisition of Informatica (expected FY 2027) - in line with the vision of CEO Marc Benioffto combine AI, CRM and data.
📊 Valuation & price target
Assumptions:
- Sales growth: 7 %
- Terminal price-to-sales: 7
- Discount rate: 10 %
➡️ Fair value per share:
246 USD
➡️ Current share price:
USD 266
🔻 Downside risk: approx. -8 %
🧭 Conclusion: Watchlist with potential
📌 My strategy:
- Observehow AgentForce establishes itself on the market
- With new growth: Adjust model upwards & check entry
- In case of sideways movement & price <240 USD: Value entry conceivable
Salesforce remains a category-defining software company - but success in the AI era depends on the implementation not just the story.
My Youtube channel for more stock analysis: www.youtube.com/@Verstehdieaktie