Last week, software company Salesforce (NYSE:CRM), released its latest earnings numbers. For the period up until the end of October, the company soundly beat expectations with revenue of $7.84 billion coming in ahead of analyst expectations of $7.82 billion. The top line was up 14% year over year. The company's adjusted earnings per share of $1.40 were also better than expectations of $1.21.
However, despite what looked to be a strong showing from the company, the stock was down as Salesforce also announced that co-CEO Bret Taylor would be resigning, leaving just Marc Benioff in charge. Anytime there's a departure in upper management, that can trigger a negative reaction in the stock, which is what is happening with Salesforce.
Salesforce is showing some good resiliency but investors may be concerned about the future, particularly if there's a downturn and businesses scale back on investments, such as sales and marketing efforts and customer relationship management systems. For now, Salesforce is doing well but tougher times could be ahead for the business.
Year to date, shares of the stock are down more than 40%, as the tech stock has widely underperformed the market and remains near its 52-week low of $136.04. It currently trades at a forward price-to-earnings multiple of 27.
For long-term investors, this could be a good opportunity to buy Salesforce as the stock's price tag doesn't appear excessive given growth the business is still achieving. And it is now trading around the levels it was at during the 2020 market crash.
