Citizens Financial Group maintained its Market Outperform rating and $315 price target on Salesforce.com following the company’s fiscal second-quarter results that exceeded analyst expectations.
Salesforce reported non-GAAP earnings per share of $5.90, well above the $3.27 consensus estimate, including a $2.53 gain from a strategic investment. Total revenue reached $11.345 billion, an 11% increase year-over-year and ahead of the $11.3 billion consensus. Subscription revenue grew 12% to $10.82 billion, outpacing the $10.79 billion estimate.
The company’s current remaining performance obligation, a key indicator of future cloud revenue potential, rose 13.9% year-over-year to $33.5 billion, accelerating from 13.5% growth in the prior quarter. Agentforce annual recurring revenue exceeded $1.5 billion, up approximately 240% year-over-year, while Informatica contributed an estimated 4 percentage points to revenue growth. Free cash flow increased 81% to $1.1 billion.
Salesforce raised its full-year revenue guidance to a range of $46.1 billion to $46.4 billion. The company’s valuation metrics included a P/E ratio of 23.86 and a PEG ratio of 0.6.
Jefferies raised its price target to $300, while Bernstein adjusted its target to $195 but maintained an Underperform rating. Salesforce shares surged 13% in after-hours trading, paring a 22% year-to-date decline. The S&P 500 and Russell 3000 are up approximately 12% and 13% year-to-date, respectively.
