Vulcan Value Partners, an investment management firm, published its “Large Cap, Small Cap, Focus Composite, Focus Plus Composite, and All Cap” fourth quarter 2020 investor letter – a copy of which can be downloaded here. Vulcan’s Large Cap, Small Cap and All Cap strategies beat both their primary and secondary benchmarks, while Focus and Focus Plus trailed their primary benchmarks but beat their secondary benchmarks. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Vulcan Value Partners, in their Q4 2020 investor letter, mentioned Salesforce.com, inc. (NYSE: CRM) and emphasized their views on the company. Salesforce.com, inc. is a San Francisco, California-based software company that currently has a $193.4 billion market capitalization. Since the beginning of the year, CRM delivered a -5.63% return, while its 12-month gains are still up by 45.85%. As of March 30, 2021, the stock closed at $210.00 per share.
Here is what Vulcan Value Partners has to say about salesforce.com, inc. in their Q4 2020 investor letter:
“We purchased Salesforce.com Inc. during the quarter. Salesforce is the dominant provider of customer relationship management (CRM) software and technology. Over the years, Salesforce has expanded its services to capture the entire lifecycle of a customer, including the ability to integrate third-party applications. Salesforce has high retention rates, pricing power, a large and growing addressable market, strong free cash flow, and a competitive moat. Salesforce is spending aggressively to capture a larger share of its rapidly growing total addressable market. As a result, we believe that Salesforce’s value should compound through continued investment in top line growth and margin expansion over time. The recent effects of COVID-19 have only improved its prospects and future returns. We purchased Salesforce.com just before the announcement of the Slack acquisition. The market reacted negatively to the acquisition, and its stock price fell, making Salesforce.com a material detractor to the portfolio during the quarter. We feel good about the acquisition of Slack as it allows for a more comprehensive CRM offering which will increase the company’s competitive moat.”
Our calculations show that Salesforce.com, inc. (NYSE: CRM) ranks 24th in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Salesforce.com, inc. was in 97 hedge fund portfolios, compared to 106 funds in the third quarter. ORCL delivered a decent -5.60% return in the past 3 months.