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Is Salesforce a ‘buy’ after its annual Dreamforce conference?

By:
on Sep 21, 2022
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  • Salesforce launched "Genie" at its annual Dreamforce conference.
  • Gradient Investments' Michael Binger shared his outlook on "CRM".
  • Shares of the cloud company have been cut in half since Nov 2021.

Salesforce Inc (NYSE: CRM) is in focus on Tuesday after the cloud company launched “Genie” at its famed annual conference – Dreamforce 2022.

How big of a deal is ‘Genie’ for Salesforce Inc?

Genie is a real-time platform for customer data that Salesforce will integrate into its other key products. According to David Schmaier, the Chief Product Officer at Salesforce:

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Every business leader wants to take advantage of real-time data to create compelling, personalised customer experiences. That’s why we built Genie, our most significant innovation ever on the Salesforce Platform. Genie makes every part of Customer 360 more automated, intelligent, and real-time.

Last month, Salesforce trimmed its guidance for the full financial year even though it did better-than-expected in the second quarter. (source)

The board also authorised share buybacks worth up to $10 billion in August.

Should you buy the beaten down shares of Salesforce?

Salesforce has been rather brutal to its investors since November 2021.

The stock has been cut in half over the past 11 months. Still, Michael Binger (President of Gradient Investments) suggests you buy shares of Salesforce at the current discount. On CNBC’s “Closing Bell: Overtime”, he said:

Sales force is the leader in SaaS. It’s seeing some macro headwinds but once we get through this, Salesforce should continue to grow its EPS and revenue at mid-teen clip. So, I still like CRM you’ll do well long-term.

Those macroeconomic challenges, he expects, will start to disappear in the final quarter of this year. His bullish view is in line with Wall Street that sees upside to $219 on average in this stock – more than a 40% upside from here.