Analysts moved to temper their one-year price-targets on Salesforce (CRM) - Get Report after the sales-tracking software giant reported solid fourth-quarter earnings but cautioned on future growth due to its integration of Slack (WORK) - Get Report.
Piper Sandler analyst Brent Bracelin trimmed his one-year price target to $240 from $242 and left his neutral rating in place, noting that he sees fiscal 2022 as a “year of digestion” with little to no improvement in margins as Salesforce integrates its acquisition of Slack.
Salesforce in December agreed to scoop up Slack for $27.6 billion.
BMO analyst Keith Bachman also trimmed his one-year price target, lowering it to $280 from $285 on expectations that improvements in fiscal 2022 and bookings guidance “… may prove to be conservative, given a better demand environment.”
Jim Cramer and the Action Alerts PLUS team also took a more optimistic long-term tack, noting that when it comes to M&A and forward-thinking in enterprise software, “… we have learned to never bet against (Salesforce founder and CEO Marc) Benioff."
“We continue to believe the market is underappreciating the Slack deal,” the AAP team wrote. "Even in a pandemic, Salesforce continues to consistently deliver 20% year-over-year sales growth and their industry-leading software is one of the biggest reasons why their customers have remained successful in a digital, work-from-anywhere environment.”