Is Salesforce a Good Investment?

OVERVIEW

Salesforce Incorporation is a company based in the United States. The company offers software as a service for companies of all sizes around the world. The company operates multiple cloud-based services that offer companies with great insights about products, new opportunities, outreach, and many other things. The company was founded in 1999.

Why You Should?

  1. Salesforce is a great growth play in an investor's portfolio. From its position in a growing industry, a changing retail industry, the company sees a good runway for exponential growth in the future. This will benefit investors in the company as the stock price will continue to rise as growth continues. This will also benefit investors in the company. I will go more into depth about some of these aspects.
  2. The COVID-19 pandemic caused a rise in demand for the products that Salesforce offers. This is because companies had to shift all of their workflows to a more digital process. Salesforce offers many digital products that help companies with key opportunities and outreach, as well as other insights about sales and other key metrics. This rise in demand has benefited the company and its investors.
  3. Salesforce recently acquired Slack, another enterprise software provider that offers companies with communication products. This will further grow Salesforce's business as an enterprise software provider. This will benefit the company’s future growth and will also benefit investors in the company. This might hurt the company and its investors in the short-term but offers long-term growth opportunities.
  4. Salesforce is a key leader in a growing industry. The cloud and software as a service industry are expected to grow to hundreds of billions of dollars in the future. Salesforce can capture some of this demand for these services. This will benefit the company and its investors and the stock price will rise along with the rise of demand for the company’s products in the future.
  5. Salesforce will further benefit from a changing retail and enterprise space. In the past, companies relied on less efficient methods. Now, companies can rely on the products that Salesforce offers. These future growth opportunities will further benefit the company and its investors.
  6. Salesforce has reported rising revenues and profits over the past couple of financial years due to the reasons mentioned above. This has helped the company make new acquisitions and has also helped the company grow in other key markets as well. This will benefit the company and its investors in the future. In the financial year of 2021, the company reported revenues of around 21.25 billion and profits of around 4.07 billion. Both of these metrics are higher than what the company reported in the financial year of 2020 when they had revenues of around 17.1 billion and profits of around 126 million.

Why You Should Not?

  1. Salesforce faces tough competition across all of the markets that it operates in from many other large cloud-computing companies. Some of these companies include IBM, Amazon, Google, Microsoft, and many others. This might hurt the company and its investors in the future.

MY OPINION

I think that Salesforce is a great long-term investment due to its position as a good growth play, the positive impacts from the COVID-19 pandemic, its large acquisition of Slack, its position in a growing industry, the changing retail industry, and rising revenues and profits. However, tough competition might hurt the company and its investors in the future.

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Aaditya Patel

Aaditya Patel

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Aaditya Patel is a writer who publishes analysis on companies publicly traded on the NYSE. Follow him @the_investing787 on Instagram for summary posts.