Oppenheimer sees potential Salesforce acquisition of Informatica as strategic

Oppenheimer analyst Brian Schwartz notes that Reuters reported that Salesforce (CRM) is considering acquiring Informatica (INFA) for potentially a below market valuation. While investors will likely be disappointed that management is considering large company M&A after frustration regarding the high premium to acquire Slack and dispelling interest in pursuing material M&A last year, in Oppenheimer’s view, adding Informatica would be strategic and value added to all Salesforce’s Clouds, especially Data Cloud and platform businesses. Salesforce’s market workflows are time-consuming and manual, requiring updating records and exchanging spreadsheets, and pairing Informatica with Salesforce will help organizations improve business processes and data quality/management, and save money by maintaining records, service needs, and running AI workflows in real-time, says the firm. It’s also defensive since it improves Salesforce’s weakness in data integration versus ServiceNow (NOW) and Microsoft (MSFT). Oppenheimer has an Outperform rating on Salesforce with a price target of $325.