5 Best Long-Term Growth Stocks To Invest In

3. Salesforce, Inc. (NYSE:CRM)

Number of Hedge Fund Holders: 116

Salesforce, Inc. (NYSE:CRM) is a San Francisco, California-based provider of cloud-based enterprise software. The company claims to be the number one provider of customer relationship management (CRM) solutions. Salesforce, Inc. (NYSE:CRM) is one of the best long-term stocks gaining investor attention currently.

Following its analyst day in September, Brent Thill at Jefferies issued an update and revealed that Salesforce, Inc. (NYSE:CRM) provided an optimistic outlook on growth, profitability, and capital returns for the coming years. The company has revealed that it intends to surpass the $50 billion sales level by 2026. This reflects a growth of 17% annually and is higher than the consensus forecast of $48 billion.

Furthermore, Salesforce, Inc. (NYSE:CRM) intends to deliver profit margins of over 25% by 2026 and intends to give back 30% to 40% of its free cash flow to shareholders either through dividends or share buyback. Following these developments, the analyst gave Salesforce, Inc. (NYSE:CRM) stock a Buy rating with a target price of $250 on September 22.

Here’s what Oakmark Funds said about Salesforce, Inc. (NYSE:CRM) in its Q3 2022 investor letter:

“Salesforce, Inc. (NYSE:CRM) has become a dominant global player in sales, customer service, commerce and marketing software over the past 20 years. The company earns 80% gross margins and grows 20% organically. Plus, virtually all of its revenue is recurring. We see Salesforce as a great business that we’ve admired from afar for a long time. More recently, the organization has made some changes at the top that prompted us to take a closer look at the stock. New CEO Bret Taylor and CFO Amy Weaver are bringing a culture of financial discipline. We believe this renewed focus on profitability and capital return, combined with Salesforce’s strong underlying business characteristics, will yield strong results. The current valuation of 3.9x next year’s revenues represents a significant discount compared to publicly traded peers and recent private market values in the software space that have similar growth profiles. We view this discount as an opportunity to invest in a great business at a good value.”