Key Takeaways
- Goldman Sachs reaffirmed its Buy recommendation on Salesforce (CRM) with a $242 price objective, while shares trade at $171.22
- Gabriela Borges, Goldman’s analyst, anticipates organic revenue growth will accelerate in the third quarter, fueled by improved booking trends and new customer acquisition
- The company is advancing its AI revenue strategy through consumption models, premium packages, and agent-specific licensing structures
- Early adopters deploying Salesforce alongside AI agents demonstrate usage rates up to 5 times higher, with Slack seeing notable adoption gains
- The cloud software giant is moving forward with its $3.6 billion purchase of Fin (previously Intercom) to enhance AI-powered customer support offerings
Shares of Salesforce (CRM) are currently changing hands at $171.22, representing a 28% decline over the last half-year period. Despite this pullback, Goldman Sachs maintains its bullish outlook, keeping its Buy recommendation and $242 price objective intact, suggesting the shares are trading below intrinsic value.
Gabriela Borges, covering the stock for Goldman Sachs, conducted meetings with Salesforce’s investor relations team in London during the first week of July. These discussions provided fresh insights into the company’s strategic direction and near-term outlook.
Borges anticipates an uptick in Salesforce’s organic growth trajectory when the company reports third-quarter results. Her optimism stems from observable improvements in new business momentum and strengthening booking patterns.
The analyst interprets management’s transparent communication regarding challenges in Tableau, Commerce, and Marketing divisions as a prudent recalibration rather than a fundamental deterioration. Goldman Sachs appreciates the company’s forthright assessment of the 12-24 month timeframe these headwinds may persist.
Diversified AI Revenue Strategy Takes Shape
Salesforce is developing what Borges characterizes as a “headless” approach to capturing AI-generated revenue. This multi-pronged framework encompasses usage-based billing, enhanced bundled offerings, and dedicated agent-focused licensing, with additional clarity anticipated at the September Agentforce conference.
Early performance metrics surrounding agent deployment are compelling. Organizations implementing Salesforce in conjunction with AI agents are registering usage levels up to five times greater compared to traditional deployments. Additionally, Slack continues demonstrating resilience as the platform integrates new large language model capabilities.
According to InvestingPro data, two dozen analysts have recently increased their earnings projections for the coming period. The enterprise maintains an impressive 77.6% gross profit margin, providing cushion against temporary operational pressures.
Fin Purchase Bolsters AI Service Capabilities
Salesforce revealed plans to acquire Fin, the company previously operating as Intercom, in a transaction valued at approximately $3.6 billion. Goldman Sachs recognizes Fin as among a select group of three or four premier platforms in the AI-enabled customer service sector.
The critical consideration, Borges notes, centers on Salesforce’s ability to seamlessly merge Fin’s technological infrastructure with its existing Agentforce ecosystem and successfully extend these capabilities to smaller enterprise customers following deal completion.
Wall Street opinions vary considerably. KeyBanc revised its stance to Sector Weight from Overweight, expressing skepticism about the timeline for Agentforce to generate meaningful revenue contribution.
Conversely, Guggenheim elevated Salesforce to Buy from Neutral, pointing to current valuation levels as presenting an opportune entry point for investors.
Citizens JMP maintained its Market Outperform designation with a $315 price objective in response to the Fin acquisition announcement. Monness similarly holds a Buy rating, albeit with a more measured $200 target.
Salesforce has additionally forged a partnership with the Visa Cash App Racing Bulls Formula 1 Team, implementing its Agentforce 360 solution and Slack platform to enhance fan interaction and streamline team coordination.
Goldman’s $242 valuation target suggests approximately 41% appreciation potential from the current market price of $171.22.
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