We recently published a list of the 10 Best Stocks to Buy and Hold For 3 Years. In this article, we are going to take a look at where Salesforce Inc. (NYSE:CRM) stands against the other best stocks to buy and hold for 3 years.
What to Expect From the Stock Market in 2025?
On December 12, Tom Lee, Fundstrat Global Advisors managing partner and head of research, joined CNBC’s ‘Closing Bell’ to discuss his playbook for 2025. Following two years of significant gains, his playbook suggests an optimistic yet cautious outlook for the stock market next year. Lee anticipates that the S&P 500 will rise to approximately 7,000 by mid-2025, before retreating to around 6,600 by the end of the year. This reflects an overall expected increase of about 8% for the year, which is consistent with historical averages for stock market returns. In terms of Earnings Per Share (EPS) estimates Lee projects EPS for the S&P 500 at $260 in 2025 while estimating $300 for 2026. This is slightly below the consensus estimates from Wall Street, which average around $268 for 2025.
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Explaining his investment thesis, Lee pointed towards several themes that could drive the market in 2025. He predicts a “tale of two halves,” where the first half of the year will see stronger market performance due to factors like Federal Reserve policies and business-friendly initiatives under President Trump. Conversely, he expects a pullback in the second half, reflecting historical trends after strong consecutive years. He sees potential in small-cap stocks, which have underperformed relative to large-cap stocks historically. Lee also talked about the mega caps that are leading. He mentioned that investors reach for these companies when there is even slight risk in the market. Secondly, mega-cap stocks are highly sensitive to falling interest rates. With the December cut in effect, the market is bullish for tech, thereby further solidifying the investment case for megacaps.
Despite his generally positive outlook, Lee acknowledges several risks that could impact market performance. For instance, he thinks the newly formed Department of Government Efficiency (DOGE) could potentially lead to reduced government spending and slower economic growth if it is too effective in cutting costs. Moreover, the implementation of tariffs could adversely affect economic conditions and corporate profits. Lee pointed out that historical patterns suggest that after two years of substantial gains, markets often experience declines in the latter half of the third year.
A customer service team in an office setting using the company’s Customer 360 platform to communicate with customers.
Our Methodology
To compile the list of 10 best stocks to buy and hold for 3 years, we applied a consensus approach. We sifted through recent articles to get an aggregated list of the best stocks to buy and hold for 3 years. Next, we ranked these stocks based on the number of hedge fund holders as of Q3 2024, sourced from Insider Monkey’s database.
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).
Salesforce Inc. (NYSE:CRM)
Number of Hedge Funds: 116
Salesforce Inc. (NYSE:CRM) is one of the best stocks to buy and hold for 3 years. It is a leading provider of customer relationship management (CRM) technology, which helps businesses manage their interactions with customers. Artificial intelligence is a major cornerstone of its cloud technology. In October, the company introduced Agentforce, a groundbreaking platform designed to create and manage autonomous AI agents. The new feature seamlessly integrated with the company’s existing tools and data systems, including the Customer 360 platform.
During the fiscal third quarter of 2025, Salesforce Inc. (NYSE:CRM) benefited greatly from this new AI feature. The company delivered $9.44 Billion in revenue up 8% year-over-year. Recently, on December 17, the company launched an upgraded version of Agentforce to its cloud technology. Agentforce 2.0 uses a new library of pre-built skills that span various applications, including CRM, Slack, and Tableau. This feature enables businesses to quickly customize AI agents for specific tasks without extensive development time, making it easier to implement tailored solutions across different teams.
Major companies including Accenture, The Adecco Group, Finnair, Heathrow Airport, IBM, Indeed, Saks Global, and SharkNinja have already embraced the new feature, indicating strong demand for its technology. Management has raised its fiscal fourth quarter 2025 revenue guidance to between $9.9 billion and $10.10 billion, representing around 8% growth year-over-year.
Polen Focus Growth Strategy stated the following regarding Salesforce, Inc. (NYSE:CRM) in its Q3 2024 investor letter:
“In the third quarter, we purchased new positions in Apple and Oracle and eliminated our small positions in Nike and Salesforce, Inc. (NYSE:CRM). We exited our position in Salesforce to fund better opportunities in Shopify and MSCI. Salesforce is seeing slower revenue growth than we would have expected, given the weakening macroeconomic environment. Furthermore, since its core end markets in customer relationship management (“CRM”) and Service are fairly mature, a lower growth level versus our expectations could persist for some time.”
Overall, CRM ranks 5th on our list of best stocks to buy and hold for 3 years. While we acknowledge the potential of CRM to grow, 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.
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Disclosure: None. This article is originally published at Insider Monkey.
