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Salesforce.com Inc
CRM : NYSE : Technology
$59.86 | %
Today's Range: 59.31 - 60.48
Avg. Daily Volume: 4,901,700
12/19/14 - 4:03 PM ET

Financial Analysis


SALESFORCE.COM INC's gross profit margin for the third quarter of its fiscal year 2014 is essentially unchanged when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. SALESFORCE.COM INC has weak liquidity. Currently, the Quick Ratio is 0.56 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 28.72% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY14 Q3 FY13
Net Sales ($mil)1383.661076.03
EBITDA ($mil)87.614.12
EBIT ($mil)-22.04-97.93
Net Income ($mil)-38.92-124.43


Balance Sheet Q3 FY14 Q3 FY13
Cash & Equiv. ($mil)1041.04703.54
Total Assets ($mil)9412.668097.63
Total Debt ($mil)1647.411874.71
Equity ($mil)3792.52946.09


Profitability Q3 FY14 Q3 FY13
Gross Profit Margin82.7584.08
EBITDA Margin6.331.31
Operating Margin-1.59-9.1
Sales Turnover0.540.46
Return on Assets-3.33-1.68
Return on Equity-8.26-4.62
Debt Q3 FY14 Q3 FY13
Current Ratio0.740.58
Debt/Capital0.30.39
Interest Expense17.6822.93
Interest Coverage-1.25-4.27


Share Data Q3 FY14 Q3 FY13
Shares outstanding (mil)631.0603.0
Div / share0.00.0
EPS-0.06-0.21
Book value / share6.014.89
Institutional Own % n/a n/a
Avg Daily Volume4731810.04916743.0

Valuation


HOLD. This stock?s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. For additional comparison, its price-to-book ratio of 9.23 indicates a significant premium versus the S&P 500 average of 2.73 and a significant premium versus the industry average of 5.82. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, SALESFORCE.COM INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CRM NM Peers 35.70   CRM 31.41 Peers 23.65

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

CRM's P/E is negative making this valuation measure meaningless.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CRM is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CRM 79.26 Peers 40.17   CRM NA Peers 11.77

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

CRM is trading at a significant premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CRM 9.23 Peers 5.82   CRM -108.16 Peers -15.51

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CRM is trading at a significant premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, CRM is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CRM 6.90 Peers 6.28   CRM 34.93 Peers 15.31

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CRM is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

CRM has a sales growth rate that significantly exceeds its peers.

 

 

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