TLDR
- JPMorgan initiated Salesforce (CRM) at Overweight with a $250 price target, calling AI disruption fears “overblown”
- CRM opened at $193.20, down 2.1%, well below its 52-week high of $269.11
- Last quarter, Salesforce beat estimates with $11.13B revenue and EPS of $3.88 vs. $3.13 expected
- Institutional investors own 80.43% of CRM; short interest fell 36.7% in late July
- Analyst consensus sits at “Moderate Buy” with an average price target of $250.28
JPMorgan initiated coverage on Salesforce (CRM) with an Overweight rating on August 13, setting a December 2027 price target of $250. Analyst Samik Chatterjee said concerns hanging over the stock are “overblown” and that the current price is factoring in further growth deceleration rather than any progress toward the company’s Rule of 50 target for FY30.
CRM opened at $193.20 on Thursday, down about 2.1% on the day. The stock sits well off its 52-week high of $269.11 and above its low of $146.32. Its 50-day moving average is $170.96 and the 200-day sits at $182.38.
JPMorgan’s Chatterjee said he expects acceleration in Salesforce’s core business in the second half of fiscal 2027, which ends in January 2027. He added that fears around disruption from frontier AI models and competition “should be limited to a small portion of the business.”
The firm also pointed to valuation, calling it “inexpensive” given low double-digit revenue growth, leading margins, and a market-leading position in enterprise CRM. JPMorgan said upside could come even without revenue acceleration, based purely on sustained growth and margins.
Earnings Beat, but Guidance Watched Closely
Salesforce posted Q1 FY2027 results on May 27. Revenue came in at $11.13 billion, up 13.3% year over year and ahead of the $11.05 billion consensus. EPS of $3.88 beat the $3.13 estimate by $0.75.
The company guided for FY2027 EPS of $14.06 to $14.12, and Q2 EPS of $3.25 to $3.27. Analysts on average expect full-year EPS of $10.27.
Salesforce also pays a quarterly dividend of $0.44 per share, representing a $1.76 annualized yield of around 0.9%.
Analyst Views Remain Split
Not everyone is as optimistic as JPMorgan. UBS raised its price target from $185 to $210 but kept a neutral rating, and flagged that Salesforce may temper expectations for revenue acceleration in the second half. Wells Fargo lifted its target from $200 to $205, also maintaining an equal-weight rating.
Sanford C. Bernstein cut its target from $194 to $173 with an underperform rating. BMO Capital trimmed its target from $225 to $215 but kept an outperform. BTIG held a buy with a $255 target.
Wall Street Zen downgraded CRM from buy to hold on August 1. Weiss Ratings lowered it to a sell in late July.
Overall, the stock holds a “Moderate Buy” consensus from MarketBeat, with an average price target of $250.28. That breakdown includes two strong buys, 25 buys, 16 holds, and four sells.
On the institutional side, Wealthcare Advisory Partners increased its stake by 36.7% in Q2, adding 4,664 units to hold 17,364 worth around $2.72 million. Institutional investors as a whole own 80.43% of the company.
Short interest in CRM fell 36.7% in the second half of July to 29.4 million units, reducing some of the selling pressure that had built up against the stock.
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