Whether to buy CRM stock now depends on investor confidence in the new Salesforce ( NYSE:CRM ) — a big-cap software maker focused on profits rather than sales growth.
Rising corporate spending on digital transformation projects remains a plus for Salesforce stock. But the days of Salesforce making big acquisitions, such as its purchase of Slack Technologies, could be over.
Salesforce sells software under a subscription model. Its software helps businesses organize and handle sales operations and customer relationships. The company has expanded into marketing, e-commerce, and data analytics.
Salesforce Stock: Restructuring Plan
Despite slowing growth, CRM stock has gained over 24% so far in 2023.
Activist investor Elliott Management on Jan. 23 disclosed that it has taken a multibillion-dollar investment in Salesforce. Elliott Management joined the hedge fund Starboard Value in targeting CRM stock.
Other new activist investors in CRM stock include Third Point, ValueAct Capital, and Inclusive Capital.
Analysts say a potential proxy fight looms heading into the company’s annual shareholder meeting.
Starboard in October said it aims to help the company improve margins. Before Starboard surfaced, Salesforce had approved a $10 billion buyback for CRM stock.
Salesforce, on Jan. 4 said it will cut 10% of its workforce and reduce office space as part of a restructuring plan amid expectations that revenue growth will slow in fiscal 2024.
At RBC Capital, analyst Rishi Jaluria said Salesforce could divest its Slack, a maker of workplace collaboration software, or MuleSoft businesses amid pressure from activist investors.
CRM Stock: Co-CEO Structure Falters
Salesforce co-Chief Executive Bret Taylor recently departed amid other manageme...
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