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2 Salesforce Q1 Initiatives Warmly Received By Customers

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2 Salesforce Q1 Initiatives Warmly Received By Customers
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Reviewing salesforce.com, inc. (NYSE: CRM)'s first-quarter results released Thursday after the close, Stifel referred to the company's assertion that two initiatives in the quarter yielded positive customer feedback.

Initiatives Yield Fruit

Analysts Tom Roderick and Parker Lane highlighted the expansion of the company's services in Australia through Amazon.com, Inc. (NASDAQ: AMZN)'s AWS and the opening of a second data center in Japan.

The analysts noted that the initiatives helped the company expand its relationship with one of the leading wealth management firms in Australia and landed wins with Softbank and Mizuno in Japan.

Q1 Print

Stifel noted that the company's first-quarter 2018 financial results were ahead of the consensus estimates across all core metrics, including a $137 million bookings beat.

The outperformance was attributed to the success in financial services and government verticals during the quarter, the firm noted. New customer wins and expansions were with companies such as Visa Inc (NYSE: V), Northern Trust Corporation (NASDAQ: NTRS), the U.S. Army, U.S. Air Force and the state of Florida.

With multi-product deals with an iconic tech brand and a major global telecom, the firm noted that salesforce now has under its fold 10 of the top 15 global telecom providers.

Acquisitions Help

Stifel noted that it sold 20,000+ seats of Quip, the productivity suite and collaborative platform it acquired last year. Additionally, the SteelBrick CPQ feature set it acquired in late 2015 helped it to expand its relationship with Northern Trust.

Outlook

Citing solid bookings in the first quarter, the firm noted that salesforce raised its revenue guidance. The second-quarter revenues and non-GAAP earnings per share are now expected at $2.51 billion–$2.52 billion and $0.31–0.32, ahead of the consensus estimates. The company's full-year guidance calls for revenues of $10.25 billion–$10.30 billion and non-GAAP earnings per share of $1.28–$1.30. The firm also noted that the company targets deferred revenue growth of 22 percent and growth in cash flow from operations of 20–21 percent.

As such, Stifel maintains its Buy rating on the shares of salesforce and lifted its price target to $105 from $100.

At the time of writing, shares of salesforce were up 1.93 percent at $89.44.

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Image Credit: By Raysonho @ Open Grid Scheduler / Grid Engine - Own work, CC0, via Wikimedia Commons

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DateFirmActionFromTo
Sep 2017Moffett NathansonInitiates Coverage OnBuy
Aug 2017JefferiesMaintainsHold
Aug 2017CitigroupMaintainsBuy

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