Salesforce downgraded at RBC Capital on execution risk post Informatica deal

As previously reported, RBC Capital analyst Rishi Jaluria downgraded Salesforce (CRM) to Sector Perform from Outperform with a price target of $275, down from $420, after Salesforce reported a relatively in-line quarter. The downgrade is primarily driven by the formally announced acquisition of Informatica (INFA) for $8B and merger model, as well as longer-term concerns, the analyst tells investors. The acquisition of Informatica is a signal Salesforce may be back to its old “empire building” ways, says the analyst, who questions the necessity of owning Informatica versus partnering. Additionally, the firm is “mixed on Salesforce’s AI strategy,” the analyst says.