Salesforce.com Inc

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CRM : NYSE : Technology
$82.13 up 0.52 | 0.64%
Today's Range: 81.3 - 82.35
Avg. Daily Volume: 4751500.0
03/28/17 - 3:59 PM ET

Financial Analysis


SALESFORCE.COM INC's gross profit margin for the fourth quarter of its fiscal year 2016 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 0.75 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 49.91% 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 Q4 FY16 Q4 FY15
Net Sales ($mil)2293.991809.4
EBITDA ($mil)156.86152.7
EBIT ($mil)-23.9119.8
Net Income ($mil)-51.44-25.51


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)2208.891341.38
Total Assets ($mil)17584.9212770.77
Total Debt ($mil)2228.71506.06
Equity ($mil)7500.135002.87


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin79.2281.72
EBITDA Margin6.838.43
Operating Margin-1.041.09
Sales Turnover0.480.52
Return on Assets1.02-0.37
Return on Equity2.39-0.94
Debt Q4 FY16 Q4 FY15
Current Ratio0.830.77
Debt/Capital0.230.23
Interest Expense24.3219.47
Interest Coverage-0.981.02


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)707.46670.93
Div / share0.00.0
EPS-0.07-0.04
Book value / share10.67.46
Institutional Own % n/a n/a
Avg Daily Volume4723970.08238934.0

Valuation


HOLD. SALESFORCE.COM INC's P/E ratio indicates a significant premium compared to an average of 55.43 for the Software industry and a significant premium compared to the S&P 500 average of 26.33. For additional comparison, its price-to-book ratio of 7.69 indicates a significant premium versus the S&P 500 average of 2.93 and a discount versus the industry average of 8.41. The price-to-sales ratio is well above both the S&P 500 average and 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 301.93 Peers 55.43   CRM 26.67 Peers 21.92

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.

 

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 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 48.24 Peers 33.36   CRM 0.76 Peers 0.83

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 7.69 Peers 8.41   CRM 485.71 Peers 43.15

Average. 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 valuation on par with 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 6.87 Peers 6.32   CRM 25.86 Peers 7.57

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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