Is Salesforce (CRM) an Excellent Investment?

Is Salesforce (CRM) an Excellent Investment?
Is Salesforce (CRM) an Excellent Investment?

Is Salesforce (CRM) an Excellent Investment? Polen Capital, an investment management firm, released its “Polen Focus Growth” investor letter for the third quarter of 2021, which can be accessed here.

The fund generated a quarterly gross return of 2.78 percent in the third quarter of 2021, exceeding both its Russell 1000 Growth benchmark’s 1.16 percent return and the S&P 500 Index’s 0.59 percent gain over the same period. You may get an indication of the fund’s best picks for 2021 by looking at its top 5 holdings.

Polen Capital cited salesforce.com, inc. (NYSE: CRM) in its Q3 2021 investor letter and discussed its position on the company. Salesforce.com, Inc. is a software business situated in San Francisco, California, with a market valuation of $286.4 billion. CRM has returned 31.99 percent since the start of the year, while its 12-month returns have increased by 21.38 percent. On October 22, 2021, the stock closed at $293.73 per share.

In its Q3 2021 investor letter, Polen Capital has the following to say about salesforce.com, inc.

“Salesforce was put under fire earlier this year after agreeing to pay $26 billion for Slack. Since then, management has clearly explained the strategic justification for Slack and its integration with the company’s other software offerings, as well as demonstrating double-digit organic revenue growth in its heritage product offerings. At its recent investor day, the business also disclosed long-term development objectives that were in line with our expectations but likely exceeded those of others, particularly in terms of margin expansion.”

Related: CRM in 2025

Is Salesforce an Excellent Investment

Salesforce.com, inc. (NYSE: CRM) is ranked 15th among the 30 Most Popular Stocks Among Hedge Funds, according to our estimates. At the end of the first half of 2021, CRM was in 108 hedge fund portfolios, up from 91 funds the previous quarter. In the last three months, salesforce.com, inc. (NYSE: CRM) has returned 18.62 percent.

In the previous decade, hedge funds’ reputation as savvy investors has been tarnished as their hedged returns failed to keep up with the unhedged returns of market indices.

Between 1999 and 2016, hedge funds’ small-cap stock picks outperformed the market by double digits annually, according to our analysis, although the margin of outperformance has been shrinking in recent years. Despite this, we were able to predict ahead of time a small group of hedge fund holdings that had outperformed the S&P 500 ETFs by 115 percentage points since March 2017. (see the details here). We were also able to predict ahead of time a small set of hedge fund holdings that underperformed the market by 10% every year between 2006 and 2017.

The margin of underperformance of these stocks has been expanding in recent years, which is interesting. Between 2015 and 2017, investors who were long the market and short these stocks saw yearly returns of more than 27%. Since February 2017, we’ve been following and releasing the list of these equities in our quarterly newsletter.

Insider Monkey combs through a variety of sources in search of the next big investing opportunity. Lithium mining, for example, is currently one of the fastest-growing industries, so we’re looking at stock pitches like this developing lithium stock.

We sift through lists like the 10 greatest EV stocks in order to find the next Tesla that will pay off tenfold. Even though we only propose positions in a small percentage of the firms we research, we look at as many as we can. We read hedge fund investor letters and attend hedge fund conferences to hear stock proposals. On our homepage, you can sign up for our free daily newsletter.

News Credit: Yahoo Finance