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S&P 500 (NYSE:SPY) component Salesforce.com (NYSE:CRM) will unveil its latest earnings on Tuesday, November 20, 2012. Salesforce.com is a cloud computing company, which provides customer relationship management products to businesses. It offers a technology platform for Internet-based computing, storage, and connectivity solutions for customers and developers.
Salesforce.com Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average analyst estimate is for a loss of 10 cents per share, a spike from net income of 7 cents in the year-ago quarter. During the past three months, the average estimate has moved down from a loss of 3 cents. Between one and three months ago, the average estimate moved down. It has been unchanged at a loss of 10 cents during the last month. For the year, analysts are projecting net loss of 9 cents per share, a spike from profit of 31 cents last year.
Past Earnings Performance: The company topped estimates last quarter after missing forecasts the quarter prior. In the second quarter, it reported net income of 5 cents per share against a mean estimate of profit of 4 cents per share. In the first quarter, it missed forecasts by 2 cents.
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A Look Back: In the second quarter, the company’s loss widened to a loss of a $9.8 million (7 cents a share) from a loss of $4.3 million (3 cents) a year earlier, but beat analyst expectations. Revenue rose 34% to $731.6 million from $546 million.
Wall St. Revenue Expectations: Analysts predict a rise of 32.9% in revenue from the year-earlier quarter to $776.5 million.
Stock Price Performance: Between September 19, 2012 and November 14, 2012, the stock price had fallen $18.30 (-11.6%), from $157.98 to $139.68. The stock price saw one of its best stretches over the last year between August 14, 2012 and August 22, 2012, when shares rose for seven straight days, increasing 4.3% (+$6.06) over that span. It saw one of its worst periods between November 15, 2011 and November 25, 2011 when shares fell for eight straight days, dropping 23.2% (-$31.67) over that span.
The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 36.6% over the last four quarters.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.8 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company improved this liquidity measure from 0.79 in the first quarter to the last quarter driven in part by an increase in current assets. Current assets increased 40.1% to $1.85 billion while liabilities rose by 38.9% to $2.33 billion.
Analyst Ratings: With 28 analysts rating the stock a buy, two rating it a sell and two rating the stock a hold, there are indications of a bullish stance by analysts.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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