Salesforce (CRM) is back in talks to acquire Informatica (INFA), a data-management software firm, reviving a deal that previously fell through in April 2024. If successful, this move can bolster CRM’s position in AI-driven cloud solutions. Importantly, the news comes just ahead of the company’s fiscal Q1 earnings, due on May 28.
Confident Investing Starts Here:
- Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter
Following news of the acquisition talks, Informatica’s shares surged by 17% on Friday, while Salesforce stock dipped 3%.
It must be noted that last year, CRM explored buying Informatica in a deal worth about $10 billion. However, the talks broke down as both sides could not agree on terms. Since then, Informatica stock has fallen, and now the company is worth less than $7 billion.
Why Informatica?
Informatica helps firms store and manage data in the cloud. Its tools let companies automate tasks and connect data across different platforms. With over 5,000 big customers, Informatica’s technology is used for data transfers, analytics, and AI-powered processes.
The renewed interest in this deal comes as companies want to use their own data to build better AI tools. This has made Informatica more valuable, since its software helps businesses organize and clean data for AI models.
For Salesforce, a leader in cloud-based customer relationship management (CRM) software, acquiring Informatica would be a strategic move.
Interestingly, this deal would rank among Salesforce’s largest acquisitions, second only to its about $28 billion purchase of Slack Technologies in 2021.
Analysts’ View Ahead of CRM’s Q1 Earnings
Ahead of Q1 results, analysts expect Salesforce to report earnings per share of $2.55, up 4.5% from the prior-year quarter. Also, the company’s revenue is expected to increase by about 7% to $9.75 billion in the first quarter.
Is CRM a Buy, Hold, or Sell?
Turning to Wall Street, CRM stock has a Moderate Buy consensus rating based on 32 Buys, eight Holds, and three Sells assigned in the last three months. At $355.71, the average Salesforce stock price target implies a 30.23% upside potential.
Looking for a trading platform? Check out TipRanks' Best Online Brokers , and find the ideal broker for your trades.
Report an Issue