On Friday, BMO Capital Markets adjusted its outlook on shares of Salesforce.com, Inc. (NYSE: CRM), increasing the stock's price target from $305.00 to $385.00. The firm continues to recommend an Outperform rating for the cloud-based software company's shares. The revision comes amid strong initial feedback for Salesforce's new product, Agentforce, which is anticipated to positively impact the company's revenue and growth in the second half of fiscal year 2026.
According to BMO Capital, the reception to Agentforce has been notably more favorable than reactions to previous new solutions from Salesforce. The analyst expects this enthusiasm to potentially result in a modest upside to the company's current committed monthly recurring revenue (CC CRPO) growth guidance for the quarter. Despite this, the focus may shift somewhat away from immediate CRPO metrics due to the early interest in Agentforce.
The firm's decision to raise the price target to $385 reflects a confidence in the future performance of Salesforce, bolstered by the potential of Agentforce to contribute to the company's financial metrics. This positive outlook is maintained despite the suggestion that near-term CRPO metrics might experience less scrutiny as a result of the new product's introduction.
The analyst's commentary highlights the belief that Agentforce could alleviate some of the pressure on near-term CRPO metrics, which are a key indicator of the company's revenue performance. This could mean that while immediate financial indicators are important, the strategic value of Agentforce may be recognized as having a longer-term benefit.
In summary, BMO Capital's revised price target for Salesforce is based on the promising initial channel feedback for Agentforce and its expected contribution to the company's growth and revenue in the latter part of fiscal year 2026. The firm maintains its Outperform rating, indicating a positive outlook for the company's stock performance.
In other recent news, Salesforce.com Inc (NYSE:CRM). reported strong second-quarter earnings, with earnings per share of $2.56, an 8% increase in sales, and a 9% rise in subscription and support revenues. The company also made significant acquisitions, buying Zoomin and Own Company for $1.9 billion in cash.
In terms of analyst ratings, Loop Capital, Piper Sandler, and CFRA have raised their price targets for Salesforce to $340, $325, and $343 respectively, while Oppenheimer has increased its target to $330.
Contrastingly, Erste Group and TD Cowen have downgraded the stock to Hold due to projected slower growth. Salesforce also plans to hire 1,000 new employees to support Agentforce sales, indicating a stable business capable of expanding its workforce.
In addition, investment firm Starboard Value LP identified Salesforce as a potential value creation opportunity at the 2024 Active-Passive Investor Summit. In other significant developments, hedge fund D.E. Shaw backed Mantle Ridge's campaign for changes at Air Products and Chemicals (NYSE:APD), Inc. These are recent developments in Salesforce's ongoing industry efforts.
InvestingPro Insights
Salesforce's strong market position and financial performance are further highlighted by recent data from InvestingPro. The company boasts a substantial market capitalization of $317.06 billion, reflecting its significant presence in the software industry. Salesforce's impressive gross profit margin of 76.35% for the last twelve months as of Q2 2025 underscores its operational efficiency and aligns with the InvestingPro Tip noting "impressive gross profit margins."
The company's revenue growth of 10.26% over the same period, coupled with an EBITDA growth of 11.12%, supports BMO Capital's optimistic outlook on Salesforce's future performance, particularly with the introduction of Agentforce. This growth trajectory is complemented by Salesforce's strong stock performance, with a one-year price total return of 51.82% as of the latest data.
InvestingPro Tips also indicate that Salesforce is "trading near its 52-week high" and has shown "strong returns over the last three months," which aligns with the positive sentiment expressed in the BMO Capital analysis. These insights suggest that the market is already pricing in some of the anticipated benefits from new products like Agentforce.
For investors seeking a more comprehensive analysis, InvestingPro offers 18 additional tips for Salesforce, providing a deeper understanding of the company's financial health and market position.
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