Baird raised its price target on Salesforce to $275 from $225 while maintaining an Outperform rating, citing stronger-than-expected second-quarter results and an upgraded outlook for the second half of fiscal 2027.
The upgrade follows Salesforce’s report that organic revenue grew nearly 11% in the trailing twelve months, with gross margins holding at 77.64%. The company also raised its organic revenue guidance, reinforcing expectations for accelerated growth in the second half of the fiscal year—a prospect that had been largely dismissed by the market, according to Baird.
Salesforce’s stock was trading at $205.51 on August 25, down 1.70% for the session, with a trailing price-to-earnings ratio of 23.86. The company’s remaining performance obligations in constant currency rose 14% year-over-year, exceeding both the 10% estimate and management’s prior 13% projection, Mizuho noted.
Key growth drivers included continued momentum in Slack, Agentforce, and Data Cloud, alongside improvements in customer retention. Salesforce also announced a partnership with Anthropic under the name "Claudeforce," expanding its Headless strategy.
Other analysts adjusted their targets following the results. Stifel raised its target to $275, Mizuho to $265, BMO Capital to $260, DA Davidson to $200, and Wells Fargo to $230, with the latter maintaining an Equal Weight rating.
Agentforce’s annual recurring revenue surged more than 240% year-over-year, while remaining performance obligations for the first time since the third quarter of 2026 exceeded expectations, BMO Capital highlighted. Baird is scheduled to meet with management in early September ahead of the Dreamforce conference.
