Canaccord: 'we continue to think CRM is a relatively low-risk bet in large-cap software'

Canaccord Genuity analyst David Hynes Jr. reiterated a Buy rating and $300.00 price target on salesforce.com (NYSE: CRM).

The analyst comments "We talk a lot more about the “why” behind all of this in the pages that follow, but at a summary level, it’s a combination of a reimagined platform for the Agentic Enterprise (at the data layer, the agentic layer, and the apps layer), an acceleration in sales capacity build out, which is supported by demand, more options in terms of commercial licensing arrangements, and a consumption flywheel that should lead to use case proliferation. To that point, management made the case that a “fundamental” Salesforce customer (those with ~3 clouds on mid-tier editions) who makes the shift to being an “Agentic Enterprise” can 3-4x their ARR spend, which speaks to the multiplier effect of the Agentforce vision. In terms of what this all means for the stock, our view here is largely unchanged – CRM shares are cheap. Saying that growth is going to improve is one thing, but showing it is another, and clearly, this is going to take a little time. That said, if management projections are correct, we’re probably a year away from tangible improvements in revenue growth, which likely means we should see it in leading indicators even sooner. As this starts to play out, while margins continue to inch higher, acquisitions are additive to the growth profile, and CRM continues to buy back stock, we think CRM is set up for a gradual re-rating higher. Obviously, none of this is a lock, but at these valuation levels, we continue to think CRM is a relatively low-risk bet in large-cap software. Our BUY rating is unchanged."

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 $236.58 yesterday.

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