SALESFORCE INC (CRM) Stock Fundamental Analysis
NYSE:CRM - New York Stock Exchange, Inc. - US79466L3024 - Common Stock - Currency: USD
Overall CRM gets a fundamental rating of 7 out of 10. We evaluated CRM against 283 industry peers in the Software industry. CRM has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CRM is growing strongly while it is still valued neutral. This is a good combination! This makes CRM very considerable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year CRM was profitable.
In the past year CRM had a positive cash flow from operations.
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's Return On Assets of 6.02% is fine compared to the rest of the industry. CRM outperforms 77.03% of its industry peers.
CRM's Return On Equity of 10.13% is fine compared to the rest of the industry. CRM outperforms 77.39% of its industry peers.
CRM has a Return On Invested Capital of 8.53%. This is amongst the best in the industry. CRM outperforms 81.98% 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 12.21%.
The 3 year average ROIC (5.83%) for CRM is below the current ROIC(8.53%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.02% | ||
| ROE | 10.13% | ||
| ROIC | 8.53% |
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 16.35%, CRM belongs to the top of the industry, outperforming 82.33% of the companies in the same industry.
In the last couple of years the Profit Margin of CRM has grown nicely.
Looking at the Operating Margin, with a value of 20.23%, CRM belongs to the top of the industry, outperforming 87.63% of the companies in the same industry.
In the last couple of years the Operating Margin of CRM has grown nicely.
Looking at the Gross Margin, with a value of 77.19%, CRM is in the better half of the industry, outperforming 74.20% of the companies in the same industry.
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 | 20.23% | ||
| PM (TTM) | 16.35% | ||
| GM | 77.19% |
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
The number of shares outstanding for CRM has been increased compared to 5 years ago.
The debt/assets ratio for CRM has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.83 indicates that CRM is not in any danger for bankruptcy at the moment.
CRM has a Altman-Z score of 4.83. This is in the better half of the industry: CRM outperforms 68.90% of its industry peers.
The Debt to FCF ratio of CRM is 0.68, which is an excellent value as it means it would take CRM, only 0.68 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.68, CRM is in the better half of the industry, outperforming 75.27% 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 49.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.68 | ||
| Altman-Z | 4.83 |
ROIC/WACC0.78
WACC10.89%
2.3 Liquidity
CRM has a Current Ratio of 1.06. 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 1.06. This is in the lower half of the industry: CRM underperforms 72.44% of its industry peers.
CRM has a Quick Ratio of 1.06. 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 worse Quick ratio (1.06) than 71.38% 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 | 1.06 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
CRM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 24.12%, which is quite impressive.
CRM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.71% yearly.
Looking at the last year, CRM shows a quite strong growth in Revenue. The Revenue has grown by 8.72% in the last year.
The Revenue has been growing by 17.25% on average over the past years. This is quite good.
EPS 1Y (TTM)24.12%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%21.4%
Revenue 1Y (TTM)8.72%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%7.6%
3.2 Future
Based on estimates for the next years, CRM will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.03% on average per year.
Based on estimates for the next years, CRM will show a quite strong growth in Revenue. The Revenue will grow by 8.94% on average per year.
EPS Next Y10.48%
EPS Next 2Y11.46%
EPS Next 3Y13.04%
EPS Next 5Y11.03%
Revenue Next Year7.56%
Revenue Next 2Y8.34%
Revenue Next 3Y9.15%
Revenue Next 5Y8.94%
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
A Price/Earnings ratio of 28.27 indicates a quite expensive valuation of CRM.
69.61% 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 26.60, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 25.59, CRM can be considered very expensive at the moment.
CRM's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CRM is cheaper than 68.55% of the companies in the same industry.
CRM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.27 | ||
| Fwd PE | 25.59 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CRM is valued a bit cheaper than the industry average as 79.15% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, CRM is valued a bit cheaper than 78.80% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.23 | ||
| EV/EBITDA | 23.84 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of CRM may justify a higher PE ratio.
CRM's earnings are expected to grow with 13.04% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.7
PEG (5Y)1.02
EPS Next 2Y11.46%
EPS Next 3Y13.04%
5. Dividend
5.1 Amount
With a yearly dividend of 0.57%, CRM is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 14.22, CRM pays a better dividend. On top of this CRM pays more dividend than 90.46% of the companies listed in the same industry.
With a Dividend Yield of 0.57, CRM pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.57% |
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
24.80% of the earnings are spent on dividend by CRM. This is a low number and sustainable payout ratio.
DP24.8%
EPS Next 2Y11.46%
EPS Next 3Y13.04%
288.06
+0.43 (+0.15%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners82.99%
Inst Owner Change1.75%
Ins Owners2.56%
Ins Owner Change-1.53%
Market Cap276.38B
Analysts79.31
Price Target371.77 (29.06%)
Short Float %1.36%
Short Ratio1.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.57% |
Yearly Dividend1.59
Dividend Growth(5Y)N/A
DP24.8%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.61%
Min EPS beat(2)-2.3%
Max EPS beat(2)5.52%
EPS beat(4)3
Avg EPS beat(4)3.11%
Min EPS beat(4)-2.3%
Max EPS beat(4)7.51%
EPS beat(8)7
Avg EPS beat(8)3.58%
EPS beat(12)11
Avg EPS beat(12)6.98%
EPS beat(16)15
Avg EPS beat(16)14.25%
Revenue beat(2)1
Avg Revenue beat(2)-0.7%
Min Revenue beat(2)-1.42%
Max Revenue beat(2)0.02%
Revenue beat(4)1
Avg Revenue beat(4)-0.72%
Min Revenue beat(4)-1.45%
Max Revenue beat(4)0.02%
Revenue beat(8)1
Avg Revenue beat(8)-0.54%
Revenue beat(12)2
Avg Revenue beat(12)-0.2%
Revenue beat(16)5
Avg Revenue beat(16)-0.08%
PT rev (1m)-2.83%
PT rev (3m)-8.61%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-2.81%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)-0.23%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)-1.74%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-1.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.27 | ||
| Fwd PE | 25.59 | ||
| P/S | 7.29 | ||
| P/FCF | 22.23 | ||
| P/OCF | 21.11 | ||
| P/B | 4.52 | ||
| P/tB | 50.6 | ||
| EV/EBITDA | 23.84 |
EPS(TTM)10.19
EY3.54%
EPS(NY)11.26
Fwd EY3.91%
FCF(TTM)12.96
FCFY4.5%
OCF(TTM)13.65
OCFY4.74%
SpS39.5
BVpS63.76
TBVpS5.69
PEG (NY)2.7
PEG (5Y)1.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.02% | ||
| ROE | 10.13% | ||
| ROCE | 10.23% | ||
| ROIC | 8.53% | ||
| ROICexc | 10.5% | ||
| ROICexgc | 122.89% | ||
| OM | 20.23% | ||
| PM (TTM) | 16.35% | ||
| GM | 77.19% | ||
| FCFM | 32.81% |
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%
ROICexcg growth 3Y144.43%
ROICexcg 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 Turnover0.37
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.68 | ||
| Debt/EBITDA | 0.76 | ||
| Cap/Depr | 18.92% | ||
| Cap/Sales | 1.74% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 117.49% | ||
| Profit Quality | 200.65% | ||
| Current Ratio | 1.06 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 4.83 |
F-Score8
WACC10.89%
ROIC/WACC0.78
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)24.12%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%21.4%
EPS Next Y10.48%
EPS Next 2Y11.46%
EPS Next 3Y13.04%
EPS Next 5Y11.03%
Revenue 1Y (TTM)8.72%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%7.6%
Revenue Next Year7.56%
Revenue Next 2Y8.34%
Revenue Next 3Y9.15%
Revenue Next 5Y8.94%
EBIT growth 1Y27.79%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year36.48%
EBIT Next 3Y15.97%
EBIT Next 5Y12.18%
FCF growth 1Y30.91%
FCF growth 3Y33.02%
FCF growth 5Y27.52%
OCF growth 1Y27.93%
OCF growth 3Y29.7%
OCF growth 5Y24.76%