We recently published a list of Jim Cramer Stocks: 10 Latest Calls. Since Salesforce Inc (NYSE:CRM) ranks 10th on the list, it deserves a deeper look.
Jim Cramer in a new program on CNBC talked about the latest pullback on Tuesday, when the market snapped its 8-day winning streak. Cramer said that the hopes of rate cuts were buoying the markets all along. According to Cramer, when a company posted a good quarter, its stock roared. If a company reported a bad quarter, investors assumed it was the “last bad quarter” because the Fed was about to start cutting rates.
“In other words, companies could do no wrong. But not today. Today we had a bit of a reckoning and dose of reality being thrown in our faces.”
Cramer talked about two home improvement companies that recently reported their quarters. According to Cramer, these results show that the consumer is still extremely cautious, and high mortgage rates and inflation is keeping spending on big-ticket items depressed.
“Wall Street is maybe expecting not good news from the Fed on Friday and therefore a slowdown, a bad slowdown,” Cramer said.
Jim Cramer said the market is “rational” again and the optimism needed to be “tempered” before the next rally.
For this article we watched several latest programs of Jim Cramer aired on CNBC and picked 10 stocks he’s recommending investors to buy or sell. With each company, we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
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Salesforce Inc (NYSE:CRM)
Number of Hedge Fund Investors: 120
Jim Cramer in a latest tweet shared that Salesforce is a part of his charitable trust’s portfolio. Cramer was commenting on CRM CEO Marc Benioff’s tweet in which he said that Salesforce’s AI-driven customer support platform Agentforce, code-named Atlas, resolves 90%+ of all customer inquiries for the company’s top healthcare, financial services, payments, travel & entertainment clients.
“I like this.. Salesforce owned by charitable trust,” Cramer said.
BofA Securities believes Salesforce Inc (NYSE:CRM) is one of the best beaten-down tech stocks presenting an attractive entry point following the latest selloff.
According to Yahoo Finance data, Salesforce Inc (NYSE:CRM) is expected to see earnings growth of about 16% on a per-annum basis over the next five years. Data also shows the company is expected to deliver double-digit YoY EPS growth in the next ten out of eleven quarters.
While Salesforce Inc (NYSE:CRM) is primarily a customer relationship software company, with notable tools and platforms like Sales Cloud, Service Cloud, Marketing Cloud, Tableau, MuleSoft, and Slack, its most promising platform is Data Cloud when it comes to AI and software. The platform has 90% year-over-year growth and clocking in $400 million in FY2024. What does this platform do? It helps organizations process data from various departments and third-party cloud solutions. Powered by an AI-driven data engine, it analyzes metadata in real time to provide valuable insights, supporting sales, marketing, and customer service workflows.
As of the end of Q1 Salesforce Inc (NYSE:CRM) had $17.7 billion in cash and low financial leverage.
Mizuho Securities analyst Gregg Moskowitz thinks the company is still “well situated” to help customers in digital transformation. However, the analyst thinks Salesforce Inc. (NYSE:CRM) would do so by prioritizing profitable growth. The analyst reiterated his Buy rating on the stock but cut his price target to $300 from $345.
Morgan Stanley analyst Keith Weiss, who has an Overweight rating and a $320 price target on Salesforce Inc. (NYSE:CRM), said that Salesforce’s PEG ratio of 1.2 shows the market is not pricing in operational discipline and earnings growth sustainability.
Overall, Salesforce Inc (NYSE:CRM) ranks 10th on Insider Monkey’s list titled Jim Cramer Stocks: 10 Latest Calls. While we acknowledge the potential of Salesforce Inc (NYSE:CRM), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than CRM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
