Q2 Shows No Hint of Deterioration at salesforce.com (CRM) - Needham & Company

August 30, 2013 8:46 AM EDT
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Needham & Company analyst Michael Huang reiterated a Buy rating and $50 price target on salesforce.com (NYSE: CRM) following solid Q2 results.

"Q2 was solid, highlighted by accelerated bookings growth (billings up 38% y/y and up 30% y/y excluding ExactTarget vs. up 17% y/y in Q1), accelerated total backlog growth (up 35% y/y vs. up 32% in Q1), strength across product areas and geographies, an important/impressive senior Exec hire (former head of NA sales at Oracle), solid CFO growth (up 34% y/y), and notable rev and EPS upside," Huang notes.

He added, "Importantly, we don't detect any meaningful deterioration of sales cycles or close rates across geographies due to macro pressures or to a constrained IT spending environment, which suggests the strength of competitive positioning, the strength of the SaaS secular, the numerous product cycles, and the magnitude of opportunity ahead."

The firm lowered FY 2014 EPS from $0.48 to $0.33 and FY 2015 EPS from $0.68 to $0.51.

For an analyst ratings summary and ratings history on salesforce.com click here. For more ratings news on salesforce.com click here.

Shares of salesforce.com closed at $43.65 yesterday.

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