Jim Cramer on Salesforce: “The Company Can Make a Ton of Money”

Salesforce, Inc. (NYSE:CRM) is one of the stocks Jim Cramer shared insights on. During the episode, Cramer discussed the company’s earnings and the market sentiment toward the company. He said:

“To me, there are four main components that I look for when a company reports: Did it beat sales and earnings projections for the quarter? And did it then raise sales and earnings projections for the future quarter? Salesforce handily beat the projections made about this just-reported quarter. So far, so good. But their cash flow came in a little weaker than Wall Street expected. While their guidance for the current quarter was solid, there were individual lines in that guidance that were again softer than what the analysts anticipated.

I figured Wall Street would maybe look past those negatives, given the huge number Salesforce is putting up overall. But that’s not what happened. Instead, we were inundated with stories about how Salesforce gave weak performance… Salesforce’s stock closed at $244… Keep in mind, most companies are not using AI in any way yet that’s visibly making any money, but Salesforce is serving up customers who are thrilled about Agentforce and how well it’s worked for them. I think we’ll hear a bunch of them when we go out to Dreamforce… next month. I bet it’ll be impactful. Those points did not matter one bit, though, to the sellers…

Some of the real bears believe that Salesforce could be so efficient that its clients will slim down themselves using some of their own AI too and then let go of some of the Salesforce using workers. I think the analysis is incorrect. The bears seem to forget that Agentforce uses a different business model, a consumption model, not a per-user model, and the company can make a ton of money.

The bears don’t care, though… What would change their minds? If Salesforce were to report huge earnings and then guide up well above what Wall Street’s looking for. That would change the narrative, but that hasn’t happened yet. Will it? That’s the $230 billion question, with $230 billion being Salesforce’s current market capitalization. Ultimately, this company will either start crushing the numbers or its stock will be crushed. Why? Because like it or not, that’s how Wall Street works.”

Stock market reports printed on a sheet of paper. Photo by RDNE Stock Project on Pexels

Salesforce, Inc. (NYSE:CRM) delivers CRM technology and cloud-based solutions that unify customer interactions, data, and workflows, while integrating AI-driven analytics, automation, and productivity tools.

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Disclosure: None. This article is originally published at Insider Monkey.