Risk/Reward Rating: Negative
Salesforce is a mature company and is dominant as the world’s #1 customer relationship management (CRM) platform evidenced by it use in over 150,000 companies. As CRM growth matures and slows, Salesforce has increasingly turned to acquisitions in recent years to maintain revenue growth. Replacing organic revenue growth with acquired revenue growth usually leads to a lower valuation multiple for a stock, particularly when acquisitions are made at high price multiples.
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