We recently published a list of 10 Stocks with Consistent Growth to Buy. In this article, we are going to take a look at where Salesforce Inc. (NYSE:CRM) stands against other stocks with consistent growth to buy.
Currently, financial markets are experiencing a mix of optimism and caution as investors react to changing economic conditions. Many are closely watching trends and data that could impact future growth and stability.
Tom Lee, managing partner and head of research at Fundstrat Global Advisors, recently shared his insights on the current market trends during an interview on CNBC’s ‘Squawk Box’ on October 14. He acknowledged that he underestimated the strength of the market, noting that it has been surprisingly resilient despite expectations of volatility leading up to the 2024 election. Lee highlighted that there is a significant amount of cash—about $6 trillion—sitting on the sidelines, which has contributed to the market’s stability. He observed that many investors had anticipated a recession, but instead, companies have shown strong earnings and resilience.
Lee also mentioned that the Federal Reserve is likely to adopt a supportive stance as inflation data continues to trend toward their 2% target. He believes that regardless of who wins the upcoming election, stocks are likely to perform well in the following year. Lee pointed out that markets tend to thrive on visibility and certainty, suggesting that if one candidate appears to be gaining an advantage, it could lead to a more favorable trading environment before the election. Overall, he remains optimistic about the market’s outlook.
S&P 500 and Dow Reach New Heights Ahead of Election Season
On October 18, both the S&P 500 and the Dow Jones Industrial Average reached new record highs, marking six consecutive weeks of gains for these major indices. As reported by CNBC, the S&P 500 rose by 0.40%, closing at 5,864.67, while the Dow rose by 0.09% and added 36.86 points to close at 43,275.91. The Nasdaq also performed well, increasing 0.63% to close at 18,489.55. This marks the longest winning streak of the year for both the Dow and S&P 500, with notable increases in their overall performance.
As earnings season progresses, over 70 companies in the S&P 500 have reported their results, with about 75% of those companies surpassing expectations. Despite potential market volatility leading up to the upcoming election, some analysts believe that stocks may continue to rise through November.
Rob Williams, a chief investment strategist at Sage Advisory, noted that this trend is unusual for an election year, where markets typically hesitate before improving post-election. He suggested that investors might be optimistic about a possible victory for Republican nominee Donald Trump, whose policies are seen as more favorable for businesses in terms of regulations and taxes.
Methodology
To compile our list of the 10 stocks with consistent growth to buy, we used the Finviz and Yahoo stock screeners. We sorted our results based on market capitalization and picked the top 30 stocks.
Next, we focused on identifying stocks that had demonstrated consistent growth. From the initial list, we narrowed our choices to stocks that have grown their revenue positively over the past 5 years. We further refined our selection to include only those that had positive revenue growth each year in their last five reported annual revenues.
To ensure the reliability of our findings, we consulted reputable sources such as SeekingAlpha, which provided insights into the revenue CAGR over the past five years, and Macrotrends, which offered information on historical annual revenue data. Finally, we have ranked the 10 stocks with consistent growth to buy below in ascending order based on their five-year revenue CAGR.
Additionally, we mentioned the hedge fund sentiment surrounding each stock, which was taken from Insider Monkey’s database of 912 elite hedge funds as of Q2 of 2024.
Why do we care about what hedge funds do? 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).
A customer service team in an office setting using the company’s Customer 360 platform to communicate with customers.
Salesforce Inc. (NYSE:CRM)
5-Year Revenue CAGR: 19.88%
Number of Hedge Fund Holders: 117
Salesforce Inc. (NYSE:CRM) is a cloud-based software company that ranks among the top 3 on our list of the 10 stocks with consistent growth to buy. The company specializes in customer relationship management (CRM) and it offers a comprehensive suite of software and applications for sales, customer service, marketing, and analytics. Salesforce is the world’s leading AI CRM platform and it serves more than 150,000 businesses globally.
The company is revolutionizing enterprise software with its new and innovative Agentforce AI platform that allows organizations to create autonomous agents that automate workflows across various functions. These functions include sales, service, and marketing. This integration of AI into its core services has led to strong demand, with Salesforce signing 1,500 AI-related deals in just the second quarter of fiscal 2025.
In a strategic move to enhance its AI capabilities, Salesforce Inc. (NYSE:CRM) recently announced the acquisition of Tenyx, a developer of AI-powered voice agents. This acquisition aims to improve customer service interactions and enhance the company’s autonomous agent offerings.
Financially, Salesforce Inc. (NYSE:CRM) reported a revenue of $9.33 billion for Q2 2025, reflecting an 8% year-over-year increase. The company also demonstrated strong cash flow and returned $4.3 billion to shareholders through share repurchases.
At the end of the second quarter of fiscal 2025, Salesforce’s remaining performance obligations (RPO) reached $53.5 billion, indicating a robust future revenue stream. Over the past five years, the company has maintained impressive growth rates, with revenue increasing at a compound annual growth rate (CAGR) of nearly 20%. This consistent performance and commitment to leveraging AI for future growth make Salesforce Inc. (NYSE:CRM) a compelling stock to consider for investment.
As of the second quarter of 2024, CRM was held by 117 hedge funds, according to Insider Monkey’s database. Parnassus Investments stated the following regarding Salesforce Inc. (NYSE:CRM) in its “Parnassus Growth Equity Fund” Q2 2024 investor letter:
“Salesforce Inc.’s (NYSE:CRM) growth continues to moderate, and investors question its prospect as it relates to AI. We remain confident that the company, which developed the original salesforce automation product and pioneered the SaaS (software as a service) delivery model, is well positioned to capitalize on emerging AI opportunities.”
Overall, CRM ranks 3rd on our list of stocks with consistent growth to buy. While we acknowledge the potential of CRM, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. 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.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article is originally published at Insider Monkey.