Salesforce (CRM – Research Report), the Technology sector company, was revisited by a Wall Street analyst today. Analyst Scott Berg from Needham maintained a Buy rating on the stock and has a $400.00 price target.
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Scott Berg has given his Buy rating due to a combination of factors surrounding Salesforce’s strategic acquisition of Informatica. The acquisition is seen as a strategic move to enhance Salesforce’s data capabilities, particularly in the realm of AI, by integrating the leading data integration platform into its ecosystem. Although the valuation metrics such as EV/Revenue and EV/Free Cash Flow appear somewhat high, they are considered justifiable if Salesforce can successfully leverage Informatica within its Agentforce strategy.
Despite some concerns about Salesforce’s past challenges with integrating acquisitions and the potential lack of excitement around an aging technology platform, the acquisition is expected to strengthen Salesforce’s competitive position. The ability of Informatica to handle large volumes of data is viewed as a significant advantage in the ongoing Software Agentic race, which increasingly relies on robust data management capabilities. This strategic alignment and potential for competitive enhancement underpin the Buy rating.
In another report released today, Mizuho Securities also reiterated a Buy rating on the stock with a $380.00 price target.