Salesforce, the Technology sector company, was revisited by a Wall Street analyst today. Analyst Karl Keirstead from UBS maintained a Hold rating on the stock and has a $260.00 price target.
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Karl Keirstead has given his Hold rating due to a combination of factors observed during Salesforce’s Dreamforce event and Investor Day. While the company provided a positive outlook with a projected revenue growth exceeding 10% by fiscal year 2030 and continued margin expansion, these improvements are expected to materialize over the next 12-18 months. This timeline, coupled with limited visibility beyond two years, tempers the immediate optimism.
Furthermore, Salesforce’s reliance on AI adoption as a growth driver is challenged by the fact that many organizations are still in the early stages of their AI journeys. Despite this, Salesforce is well-positioned to benefit from future AI demand, particularly with its Data Cloud product. The stock’s current valuation is at the lower end of its peer group, suggesting limited downside risk. However, due to the uncertainties and the need for more clarity on growth trajectories, the Hold rating remains appropriate.