Salesforce.com Inc

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CRM : NYSE : Technology
$89.57 -0.97 | -1.1%
Today's Range: 89.54 - 90.63
Avg. Daily Volume: 4509400.0
07/24/17 - 9:34 AM ET

Financial Analysis


SALESFORCE.COM INC's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. SALESFORCE.COM INC has weak liquidity. Currently, the Quick Ratio is 0.62 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 42.08% 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 Q1 FY17 Q1 FY16
Net Sales ($mil)2387.581916.6
EBITDA ($mil)175.85184.05
EBIT ($mil)-9.2651.28
Net Income ($mil)-9.2138.76


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)3219.552031.19
Total Assets ($mil)17058.9312817.27
Total Debt ($mil)2039.191513.56
Equity ($mil)7934.495584.26


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin79.2180.16
EBITDA Margin7.369.6
Operating Margin-0.392.68
Sales Turnover0.520.55
Return on Assets0.77-0.09
Return on Equity1.65-0.22
Debt Q1 FY17 Q1 FY16
Current Ratio0.710.74
Debt/Capital0.20.21
Interest Expense22.222.01
Interest Coverage-0.422.33


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)712.2677.5
Div / share0.00.0
EPS-0.010.06
Book value / share11.148.24
Institutional Own % n/a n/a
Avg Daily Volume4533136.04509479.0

Valuation


HOLD. SALESFORCE.COM INC's P/E ratio indicates a significant premium compared to an average of 70.31 for the Software industry and a significant premium compared to the S&P 500 average of 24.66. For additional comparison, its price-to-book ratio of 8.13 indicates a significant premium versus the S&P 500 average of 3.07 and a discount versus the industry average of 9.15. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. The valuation analysis reveals that, 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 452.70 Peers 70.31   CRM 28.02 Peers 28.96

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

CRM is trading at a significant premium to its peers.

 

Average. 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 valuation on par 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 53.89 Peers 44.37   CRM 1.13 Peers 1.03

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.

 

Average. 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.

CRM trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CRM 8.13 Peers 9.15   CRM 1100.00 Peers 60.88

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

CRM is trading at a discount to its peers.

 

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

CRM is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CRM 7.28 Peers 6.86   CRM 25.31 Peers 11.02

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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