Salesforce.com had a record quarter, during which the company posted 35% revenue growth reaching $788 million, or 33 cents per share. The performance was helped by better than expected showing in the company's services support and subscription business, which grew 35% year over year.
Equally impressive was the company's 20% year-over-year growth in operating income, which surged 20%. The company continues to grow various business segments such as professional services at an annual rate of over 30%, all of which contributed to an 18% jump in operating income. But the company said the best is yet to come, projecting guidance of $4 billion in revenue.
That stock should be bought on that basis alone. Aside from 35% revenue growth, management is showing incredible confidence in the company's business. Executives don't go out of their way to apply pressure on themselves if they don't really believe the goal is realistic. What it says is that "we have this thing figured out."
Impressively, despite its high forward P/E of 85, the company continues to prove not only that it can grow into its valuation, but it's willing to raise the bar in the process.
Perhaps the bear concerns about profits just might be overblown -- at least for now. The stock should reach $200 by the second half of 2013.
At the time of publication, the author held no position in any of the stocks mentioned
This article was written by an independent contributor, separate from TheStreet's regular news coverage.