U.S. Markets closed

Salesforce.com (CRM) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
SMART Global Holdings, Inc. (SGH) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Salesforce.com (CRM) closed at $155.06 in the latest trading session, marking a -1.9% move from the prior day. This change lagged the S&P 500's daily gain of 0.58%. Meanwhile, the Dow gained 0.45%, and the Nasdaq, a tech-heavy index, added 1.13%.

Prior to today's trading, shares of the customer-management software developer had lost 0.39% over the past month. This has was narrower than the Computer and Technology sector's loss of 4.08% and the S&P 500's loss of 2.34% in that time.

Wall Street will be looking for positivity from CRM as it approaches its next earnings report date. This is expected to be June 4, 2019. The company is expected to report EPS of $0.61, down 17.57% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $3.68 billion, up 22.52% from the year-ago period.

CRM's full-year Zacks Consensus Estimates are calling for earnings of $2.66 per share and revenue of $16.11 billion. These results would represent year-over-year changes of -3.27% and +21.31%, respectively.

Investors should also note any recent changes to analyst estimates for CRM. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 9.66% lower within the past month. CRM currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that CRM has a Forward P/E ratio of 59.37 right now. Its industry sports an average Forward P/E of 31.38, so we one might conclude that CRM is trading at a premium comparatively.

Investors should also note that CRM has a PEG ratio of 2.59 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CRM's industry had an average PEG ratio of 2.19 as of yesterday's close.

The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 56, putting it in the top 22% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
salesforce.com, inc. (CRM) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research