salesforce.com, inc. (CRM) Loud Thud Doesn’t Negate The Long-Term Story

Despite closing 2.82 points higher on 06 December, salesforce.com, inc. (NYSE:CRM) remains a key investment for many, but the stock is also a popular trading vehicle. Here’s how to trade it using charts and trading levels Friday. The shares accumulated 2.03 percent at $142.06 with a heavy trade volume of 9.141 million shares. After opening the session at $134.8, the shares went as high as $142.06 and as low as $132.75, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $106 billion and now has 748.71 million shares outstanding. salesforce.com, inc. (CRM) stock has gained 4.89 percent of market value in 21 trading days.

CRM stock has a trailing 3-year beta of 1.42, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $1.34 a share in the trailing twelve months. The stock’s value has surged 38.96 percent year to date (YTD) against a rise of 41.09 percent in 12 month’s time. The company’s shares still trade -11.87 percent away from its 1-year high of $161.19 and 43.96 percent up from 52-week low of $98.68. The average consensus rating on the company is 1.7, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

salesforce.com, inc. (CRM) will probably climb 21.23 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $189-month high price target. This represents a whopping 33.04 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $174.5, which represents a return potential of 22.84 percent when compared to the closing price of the stock of $142.06 on Thursday, December 06. The lowest price target for the stock is $139 — slightly more than -2.15 percent from CRM’s current share price.

History has shown that shares in salesforce.com, inc. have gone up on 22 different earnings reaction days and are predicted to add 0.05 percent when the company reports upcoming earnings. Investors will get their next glimpse of CRM’s Q4 earnings on February 28. Analysts are forecasting revenue to climb 24.9 percent to $3.56B in the fiscal fourth quarter, while earnings are seen soaring by nearly 57.14 percent to $0.55 per share. It earned $0.61 per share, better than the $0.5, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $3.39B, better than the $3.37B analysts expected. Earnings are estimated to increase by 77.4 percent this year, 5.84 percent next year and continue to increase by 32.29 percent annually for the next 5 years.

Let’s take a look at some insider activity at salesforce.com, inc. (NYSE:CRM) and see the pattern. The earliest insider trade took place on 12/06/2018. Block Keith parted with a total of 2.16 thousand shares of company at average share price of $133.6. The total for the sales was set at $288.58 thousand. After this transaction, the co-CEO account balance stood at 22.71 thousand shares. The stock grew 6.33 percent since that insider sale. On 12/06/2018, Benioff Marc, Chairman of the Board & co-CEO, sold 5 thousand shares at a price per share of $138.9. This removed 694.5 thousand shares from the insider’s fortune and the stock saw a 2.28 percent rally in value since the news became public. This transaction left 32.07 million shares in the Chairman of the Board & co-CEO account.

On 12/04/2018, co-CEO Block Keith performed a sale transaction worth $308.3 thousand. This sale at $142.73 each has eliminated 2.16 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -0.47 percent decrease since the transaction was reported. The insider now is left with 22.71 thousand shares remaining in the account. Benioff Marc, who performs the Chairman of the Board & co-CEO job, sold 5 thousand shares for $710.85 thousand. The disposal occurred on 12/04/2018 was priced at $142.17 per share. The share price plunged -0.08 percent since the reporting date. Benioff Marc now left with a stake of 32.08 million CRM stock worth $4556.69 million after the insider selling.

The stock is currently hovering around the first support level of $135.85. Below this, the next support is placed in the zone of $129.65. Till the time, the CRM stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 55.99 on daily chart, which may remain a cause for concern. If the price breaks below $129.65 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $145.16 mark may result into a pull-back move towards $148.27 level.

Further, it is sporting a 8.49 on the Price-to-Sales ratio. Compare this with the industry average P/S of 3.26. 74.1 percent is the gross profit margin for salesforce.com, inc. and operating margin sits at 3.8 percent. Along with this, the net profit margin is 6.5 percent.