TLDRs;
- JPMorgan initiated Salesforce with an Overweight rating and a $250 price target, lifting investor sentiment.
- Salesforce shares outperformed the broader market as software stocks rallied across the technology sector.
- Agentforce and Data 360 posted triple-digit annual recurring revenue growth, supporting the AI rebound narrative.
- Investors are now focused on Salesforce’s August 26 earnings report for evidence of stronger organic growth.
Salesforce shares moved higher on Thursday after JPMorgan launched coverage of the software giant with an Overweight rating and a $250 price target, a call that renewed optimism around the company’s artificial intelligence strategy and its prospects for a broader growth recovery.
The stock gained nearly 2% during regular trading, outperforming both the S&P 500 and much of the enterprise software sector. The move came as investors rotated back into technology shares, with software companies benefiting from improving sentiment around AI-driven spending and the possibility of a stronger demand cycle heading into 2027.
JPMorgan’s target implies roughly 29% upside from recent trading levels. Based on Salesforce’s share count, such a re-rating would represent a substantial increase in market value, reinforcing the view that Wall Street may still be underestimating the company’s long-term earnings power.
JPMorgan Turns More Bullish
The bank’s bullish stance is centered on the idea that Salesforce’s core business can reaccelerate while AI-related risks remain manageable. Analysts believe the market has become overly cautious about the impact of generative AI on traditional software subscriptions.
Rather than viewing AI as a threat, JPMorgan argues that Salesforce is positioning itself to capture a meaningful share of enterprise spending through products such as Agentforce, Data 360, and other automation tools designed for autonomous business workflows.
The call adds to a growing debate on Wall Street. Price targets on Salesforce now range from $165 to $250, highlighting a wide divide between analysts who expect only modest growth and those who see a stronger AI-led expansion.
AI Products Gain Momentum
Salesforce’s recent quarterly results provided some support for the bullish argument. The company reported $11.13 billion in revenue for the first quarter of fiscal 2027, up 13% year over year. Remaining performance obligations, a key measure of future contracted revenue, rose 14% to $33.6 billion.
The most closely watched figure was Agentforce. Annual recurring revenue from the product reached $1.2 billion, representing growth of more than 200% from a year earlier. Combined with Data 360, related AI and data products generated approximately $3.4 billion in recurring revenue.
Those numbers are impressive, but they also show that AI remains a relatively small portion of Salesforce’s overall business. Agentforce accounted for only a few percentage points of annualized revenue, meaning the company still needs stronger adoption across its broader customer base to justify a major valuation expansion.
Earnings Become The Next Test
Investors are now looking ahead to Salesforce’s fiscal second-quarter earnings report on August 26. The company has guided for revenue of $11.27 billion to $11.35 billion, slightly below the current Wall Street consensus.
That makes the upcoming report particularly important. A modest beat could be enough to improve sentiment, but analysts will focus less on the headline number and more on organic growth trends, customer spending patterns, and the pace of AI adoption.
Another area under scrutiny is the contribution from Informatica, which is expected to provide a meaningful portion of reported growth. Investors want evidence that Salesforce’s underlying business is accelerating, not simply benefiting from acquisitions.
Stop guessing and start investing with confidence. KnockoutStocks gives you the AI insights, market intelligence, and stock research you need to spot opportunities, cut through the noise, and make smarter investment decisions — all in one powerful platform.
Sign up today and get 50% OFF full access to our premium stock picks.
Simply use coupon code SPECIAL50 at checkout to claim your exclusive discount.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
