Salesforce analysts at a number of Wall Street investment firms reiterated their optimism about the stock following the customer-relationship-management-software provider's first-quarter print.
The San Francisco company reported adjusted earnings of $1.21 a share on revenue of $5.96 billion. Analysts surveyed by FactSet were expecting earnings of 88 cents a share on revenue of $5.89 billion.
Wedbush analyst Dan Ives maintained his outperform rating and $300 price target.
"Salesforce’s customer diversification, product portfolio breadth, and ratable [software-as-a-service] model is continuing to gain significant momentum in the field as the digital-transformation-spending cycle kicks into its next gear of growth," Ives said.
Morgan Stanley analysts maintained an overweight rating and $285 price target.
The first quarter was a "solid step" in rebuilding investor confidence in the durability of the company's top-line growth, they said.
Salesforce's margin outperformance and management commentary "mark a pivot" in its view on balance of growth and profitability, Morgan Stanley said.
Jefferies analysts also affirmed a buy rating and $300 price target. The stock "remains top front-office pick as pipelines continue to improve," they said.
Cowen affirmed an outperform rating and $290 price target, encouraged by the "large deal activity and greater execution from acquired products, exemplifying CRM's ability to cross-sell assets into its large installed base."
The wider-than-expected profit margins "were also encouraging," though the firm thinks "there is more work to improve the margin narrative," Bloomberg reported.
Canaccord Genuity analyst David Hynes Jr., reiterating a buy rating and $270 target, said, “Salesforce solidly beat estimates and raised guidance for the year on the heels of a quarter in which the firm saw Q1 records for new business activity, 7-figure deals, and cash margins.”
He added: “Salesforce is operating at the heart of several significant digital transformation trends, and to the extent that we’re seeing no discernable slowdown in front-office tech spend, we expect the upside execution should persist.”
Shares of Salesforce at last check were 5.8% higher at $238.82.