This cloud computing company is projected to grow more than 30% in the next couple of years. Its shares were recently upgraded by Pivotal Research Group to “buy”.
Salesforce.com, Inc. (CRM)
from Cabot Growth Investor
Salesforce.com, Inc. (CRM) is a big-cap growth stock that’s been around for a while, yet we continue to believe the company is the Microsoft of the cloud era, with the best and broadest product line of productivity-enhancing software for most aspects of a company’s business.
Like Amazon, Salesforce had also struggled to crank out consistent earnings growth for years (though that was partly due to the way it recognized income), but that’s now changed—earnings have been kiting higher for the past few quarters, and the company is one of the few that analysts project 30%-plus bottom line growth for the next couple of years. And that says nothing of the fact that cash flow is nearly twice net income, or that the firm’s booked backlog is north of $6 billion!
The stock hasn’t been hot for the past couple of years (a good thing in our book), but CRM and its RP line have acted very well in recent weeks. We think you can buy some around here; a drop below 70 would be a red flag.
Michael Cintolo, Cabot Growth Investor, www.cabot.net, 978-745-5532, October 14, 2015