Analysts at Deutsche Bank maintained Buy rating on the shares of Salesforce.com Inc. (NYSE: CRM) with a price target of $205. They state that CRM's fiscal 2011 third quarter billings miss was purely optical driven by more ramped contracts.
DB analysts state that in the CloudForce New York City event, the message of Social Enterprise continues to resonate well with customers. They add that checks at their CloudForce Partner Investor Track showed that ServiceCloud growth could be reaching 100 percent year-over-year, while active Chatter usage adoption could be approaching 40 percent of the install base. They also said that SFDC is not facing weakness in Europe and that there are 10,000 to 20,000 seat ServiceCloud project which could be a function of European companies looking to cut information technology operating budgets by switching away from expensive Siebel implementation or upgrades. They add that their partner checks also consistently showed that 40 percent of customers of Chatters are quickly realizing the technology's potential and are adopting it for their specific workflows. They state that the slowdown in billings growth to 29 percent year-over-year was strictly optical, driven by proliferation of ramped contracts. They believe these ramped contracts are also instrumental in creating pricing power and higher customer lifeline value.
On a year-to-date basis, CRM has a share performance of -20.51 percent, and as compared to Standard & Poor's, it has an YTD share performance of -13.72 percent.
Salesforce.com provides customer and collaboration relationship management services to various businesses and industries worldwide. It also offers a technology platform for customers and developers to build and run business applications. It has a market capitalization of $16.09 billion with a P/E ratio of 327.910. It has more than 135 million outstanding shares.
Shares of Salesforce.com fell 0.22 percent, or $0.26, to ! trade at $118.16.
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