SALESFORCE INC (CRM) Stock Fundamental Analysis
USA - NYSE:CRM - US79466L3024 - Common Stock
238.88 USD
+3.19 (+1.35%)
239 USD
+0.12 (+0.05%)
Overall CRM gets a fundamental rating of 7 out of 10. We evaluated CRM against 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 decent growth rate and is not valued too expensively. With these ratings, CRM could be worth investigating further 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.
Each year in the past 5 years CRM has been profitable.
CRM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of CRM (6.83%) is better than 75.80% of its industry peers.
CRM's Return On Equity of 10.86% is fine compared to the rest of the industry. CRM outperforms 77.94% of its industry peers.
CRM has a better Return On Invested Capital (9.32%) than 82.56% 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 11.95%.
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
CRM has a better Profit Margin (16.87%) than 81.49% of its industry peers.
In the last couple of years the Profit Margin of CRM has grown nicely.
CRM has a Operating Margin of 21.22%. This is amongst the best in the industry. CRM outperforms 87.19% of its industry peers.
CRM's Operating Margin has improved in the last couple of years.
CRM has a Gross Margin of 77.65%. This is in the better half of the industry: CRM outperforms 75.09% of its industry peers.
CRM's Gross Margin has been stable in the last couple of years.
| 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
CRM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CRM has been reduced compared to 1 year ago.
Compared to 5 years ago, CRM has more shares outstanding
CRM has a better debt/assets ratio than last year.
2.2 Solvency
CRM has an Altman-Z score of 4.71. This indicates that CRM is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.71, CRM is doing good in the industry, outperforming 67.26% of the companies in the same industry.
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.
The Debt to FCF ratio of CRM (0.68) is better than 77.94% of its industry peers.
A Debt/Equity ratio of 0.14 indicates that CRM is not too dependend on debt financing.
CRM has a Debt to Equity ratio (0.14) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 0.68 | ||
| Altman-Z | 4.71 |
ROIC/WACC0.83
WACC11.19%
2.3 Liquidity
A Current Ratio of 1.12 indicates that CRM should not have too much problems paying its short term obligations.
CRM's Current ratio of 1.12 is on the low side compared to the rest of the industry. CRM is outperformed by 66.55% 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 65.12% 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 | 1.12 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
CRM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.62%, which is quite good.
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 8.33%.
The Revenue has been growing by 17.25% on average over the past years. This is quite good.
EPS 1Y (TTM)13.62%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%13.67%
Revenue 1Y (TTM)8.33%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%9.77%
3.2 Future
The Earnings Per Share is expected to grow by 12.04% on average over the next years. This is quite good.
Based on estimates for the next years, CRM will show a quite strong growth in Revenue. The Revenue will grow by 9.62% on average per year.
EPS Next Y12.75%
EPS Next 2Y12.34%
EPS Next 3Y12.66%
EPS Next 5Y12.04%
Revenue Next Year8.7%
Revenue Next 2Y8.86%
Revenue Next 3Y9%
Revenue Next 5Y9.62%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
CRM is valuated rather expensively with a Price/Earnings ratio of 22.37.
Compared to the rest of the industry, the Price/Earnings ratio of CRM indicates a somewhat cheap valuation: CRM is cheaper than 74.02% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.86, CRM is valued at the same level.
The Price/Forward Earnings ratio is 18.57, which indicates a rather expensive current valuation of CRM.
Based on the Price/Forward Earnings ratio, CRM is valued a bit cheaper than the industry average as 77.58% of the companies are valued more expensively.
CRM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.37 | ||
| Fwd PE | 18.57 |
4.2 Price Multiples
CRM's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CRM is cheaper than 81.49% of the companies in the same industry.
82.56% of the companies in the same industry are more expensive than CRM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.2 | ||
| EV/EBITDA | 18.11 |
4.3 Compensation for Growth
CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CRM may justify a higher PE ratio.
CRM's earnings are expected to grow with 12.66% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.75
PEG (5Y)0.81
EPS Next 2Y12.34%
EPS Next 3Y12.66%
5. Dividend
5.1 Amount
With a yearly dividend of 0.69%, CRM is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 39.95, CRM pays a better dividend. On top of this CRM pays more dividend than 91.10% of the companies listed in the same industry.
With a Dividend Yield of 0.69, CRM pays less dividend than the S&P500 average, which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.69% |
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 2Y12.34%
EPS Next 3Y12.66%
238.88
+3.19 (+1.35%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners83.17%
Inst Owner Change-1.86%
Ins Owners2.53%
Ins Owner Change0.69%
Market Cap227.41B
Analysts79.66
Price Target341.91 (43.13%)
Short Float %1.41%
Short Ratio1.52
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.69% |
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)-3.72%
PT rev (3m)-5.05%
EPS NQ rev (1m)0.42%
EPS NQ rev (3m)0.37%
EPS NY rev (1m)0.55%
EPS NY rev (3m)0.55%
Revenue NQ rev (1m)-0.16%
Revenue NQ rev (3m)-0.2%
Revenue NY rev (1m)0.13%
Revenue NY rev (3m)0.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.37 | ||
| Fwd PE | 18.57 | ||
| P/S | 5.76 | ||
| P/FCF | 18.2 | ||
| P/OCF | 17.27 | ||
| P/B | 3.71 | ||
| P/tB | 36.56 | ||
| EV/EBITDA | 18.11 |
EPS(TTM)10.68
EY4.47%
EPS(NY)12.86
Fwd EY5.38%
FCF(TTM)13.13
FCFY5.5%
OCF(TTM)13.83
OCFY5.79%
SpS41.49
BVpS64.42
TBVpS6.53
PEG (NY)1.75
PEG (5Y)0.81
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%
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-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 | 4.71 |
F-Score9
WACC11.19%
ROIC/WACC0.83
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)13.62%
EPS 3Y28.52%
EPS 5Y27.71%
EPS Q2Q%13.67%
EPS Next Y12.75%
EPS Next 2Y12.34%
EPS Next 3Y12.66%
EPS Next 5Y12.04%
Revenue 1Y (TTM)8.33%
Revenue growth 3Y12.67%
Revenue growth 5Y17.25%
Sales Q2Q%9.77%
Revenue Next Year8.7%
Revenue Next 2Y8.86%
Revenue Next 3Y9%
Revenue Next 5Y9.62%
EBIT growth 1Y20.59%
EBIT growth 3Y133.52%
EBIT growth 5Y75.31%
EBIT Next Year38.23%
EBIT Next 3Y17.71%
EBIT Next 5Y15.41%
FCF growth 1Y65.28%
FCF growth 3Y33.02%
FCF growth 5Y27.52%
OCF growth 1Y56.77%
OCF growth 3Y29.7%
OCF growth 5Y24.76%