JMP Analyst Believes Salesforce.com Is Seeing Payoff From Investments

JMP Securities maintains its Market Outperform rating and $92 price target on salesforce.com, inc. (NYSE: CRM), saying the company is seeing the payoff from a number of investments over the past three years, including enterprise, verticals, ecosystem and international.

JMP analysts met with CFO Mark Hawkins and Director of Investor Relations Andrew Zilli.

"While Mr. Hawkins declined to comment about current quarter business trends, our sense is that the tone of business remains solid coming off of a strong F1Q17," analyst Patrick Walravens wrote in a note.

For the second quarter, the analyst raised his revenue estimate to $2.022 billion, (formerly $2.011 billion), above the consensus of $2.020 billion, and versus guidance of $2.005 billion–$2.025 billion.

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However, Walvarens trimmed his non-GAAP EPS estimate to $0.22 (formerly $0.25), in line with the consensus and versus guidance of $0.21–$0.22. However, the analyst lifted his billings estimate to $1.887 billion from $1.876 billion and versus implied guidance of $1.822 billion–$1.903 billion.

In addition, Walravens cut his FY17 non-GAAP EPS estimate to $0.95 from $1.01 (the consensus is $0.95) on improved revenue growth of 25 percent (formerly 23 percent). However, the analyst raised his FY18 non-GAAP EPS estimate to $1.35 from $1.33 (the consensus is $1.33) on improved revenue growth of 22 percent (formerly 20 percent).

At the time of writing, shares of Salesforce were up 1.62 percent on the day, trading at $81.93.