By contrast, Salesforce just ended its fiscal first quarter with a cash balance of $3.1 billion --the deal for ExactTarget accounts to 80%. While ExactTartget should add value to Salesforce's existing portfolio and help Salesforce in areas like marketing and service function efficiency, it doesn't make this bet any less risky, especially since ExactTarget is losing $20 million per year.

You can argue that ExactTarget's digital cloud marketing capabilities will help Salesforce advance its capabilities against the likes of Constant Contact ( CTCT) and even offer a marketing edge over Oracle and IBM. But I still believe that Salesforce could have negotiated a better deal.

Even if it would have taken a bit longer, I believe Salesforce could have built the same cloud marketing platform internally for 40% of what it paid for ExactTarget. This constant lack of fiscal attention remains a concern, and this is yet another example of how Salesforce seems to operate as if revenue growth is all that matters.

With a minus 15% on return on equity, I think it's time Salesforce investors start wondering exactly for what are they paying.

At the time of publication the author had no position in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.
Richard Saintvilus is a private investor with an information technology and engineering background and the founder and producer of the investor Web site Saint's Sense. He has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.

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