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On Thursday, Raymond (NSE:RYMD) James analyst Brian Peterson adjusted the price target for Salesforce.com (NYSE:CRM) shares, reducing it to $375 from the previous $425, while maintaining a Strong Buy rating. Peterson highlighted Salesforce’s fourth fiscal quarter results, which provided evidence to support both optimistic and pessimistic perspectives. The company reported solid bookings and a positive reception to its Agentforce platform, but also a weaker than anticipated growth outlook for fiscal year 2026. According to InvestingPro data, Salesforce maintains impressive gross profit margins of 76.94% and has achieved a perfect Piotroski Score of 9, indicating strong financial health and operational efficiency.
Peterson expressed his admiration for the 120% year-over-year growth in Salesforce’s Data Cloud & AI’s Annual Recurring Revenue (ARR), which he considers significant. He also noted the potential for Salesforce to exceed its initial high-single digit guidance, given its consistent low-double digit growth in current remaining performance obligations (cRPO) heading into the first fiscal quarter. This growth, coupled with increasing profit margins, could signal a brighter future for the company.
The analyst pointed out that management’s comments regarding stabilization in the U.S. market and consistent sales hiring plans could be viewed as positive signs for the demand environment. Peterson believes that Salesforce’s market leadership, evidence of successful AI integration, and history of returning capital to shareholders make it an attractive investment, particularly as it trades at a multiple that is lower than that of its peers.
Raymond James’ stance on Salesforce comes after a quarter that seemed to offer mixed signals, with the company’s performance sparking debate among investors. Despite the lowered growth forecast for fiscal year 2026, the firm’s encouragement for investors suggests confidence in Salesforce’s long-term potential and resilience in the face of short-term challenges.
In other recent news, Salesforce Inc. reported its fourth-quarter earnings for 2025, with an earnings per share (EPS) of $2.78, surpassing analyst forecasts of $2.61. However, the company’s revenue fell short of expectations, recording $10 billion against the anticipated $10.4 billion. Despite the earnings beat, Salesforce’s stock experienced a decline, reflecting investor concerns over the revenue miss. The company reported a full-year revenue growth of 9% year-over-year, reaching $37.9 billion. Salesforce also introduced AgentForce, a new AI-powered platform, as part of its innovative growth strategy. The company projects a 7-8% revenue growth for fiscal year 2026, with expected figures between $40.5 billion and $40.9 billion. Analyst firms have noted Salesforce’s continued leadership in the AI-powered CRM market. Additionally, Salesforce announced a non-GAAP operating margin expectation of 34% for FY 2026, as it focuses on profitable growth and margin expansion.
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