Salesforce.com (CRM) vs. Its Competitors Critical Contrast

Salesforce.com (NYSE: CRM) is one of 24 publicly-traded companies in the “Cloud Computing Services” industry, but how does it contrast to its rivals? We will compare Salesforce.com to similar companies based on the strength of its profitability, risk, earnings, valuation, dividends, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares Salesforce.com and its rivals revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Salesforce.com $9.39 billion $464.08 million -880.45
Salesforce.com Competitors $939.15 million $24.07 million -79.22

Salesforce.com has higher revenue and earnings than its rivals. Salesforce.com is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Salesforce.com and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Salesforce.com -0.85% 1.83% 0.84%
Salesforce.com Competitors -49.32% -50.39% -14.11%

Institutional & Insider Ownership

87.0% of Salesforce.com shares are held by institutional investors. Comparatively, 58.1% of shares of all “Cloud Computing Services” companies are held by institutional investors. 6.7% of Salesforce.com shares are held by company insiders. Comparatively, 21.2% of shares of all “Cloud Computing Services” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Salesforce.com has a beta of 1.25, meaning that its share price is 25% more volatile than the S&P 500. Comparatively, Salesforce.com’s rivals have a beta of 0.95, meaning that their average share price is 5% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Salesforce.com and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Salesforce.com 1 4 44 0 2.88
Salesforce.com Competitors 100 522 1517 47 2.69

Salesforce.com currently has a consensus target price of $102.55, suggesting a potential upside of 5.89%. As a group, “Cloud Computing Services” companies have a potential upside of 7.55%. Given Salesforce.com’s rivals higher possible upside, analysts clearly believe Salesforce.com has less favorable growth aspects than its rivals.

Summary

Salesforce.com beats its rivals on 10 of the 13 factors compared.

About Salesforce.com

Salesforce.com, inc. is a provider of enterprise software, delivered through the cloud, with a focus on customer relationship management (CRM). The Company focuses on cloud, mobile, social, Internet of Things (IoT) and artificial intelligence technologies. The Company’s service offerings are configured and integrated with other platforms and enterprise applications. The Company delivers its service offerings via Internet browsers and on mobile devices. Its Customer Success Platform is a portfolio of service offerings providing sales force automation, customer service and support, marketing automation, digital commerce, community management, analytics, application development, IoT integration, collaborative productivity tools and its professional cloud services. Its cloud service offerings include Sales Cloud, Service Cloud, Marketing Cloud, Commerce Cloud, Community Cloud, Analytics Cloud, Salesforce Quip and Salesforce Platform.

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