Salesforce shares jumped as much as 4% intraday on Thursday, putting the stock on pace for its third-straight day of gains. This positive trend follows the stock’s quick rebound from a multi-year demand zone, between $225 – $242. Since May 2023, this range has acted as resistance and support for CRM stock. Positive momentum earlier this week brought the stock up off of its recent sell-off floor at $232.77.
Salesforce continuing to do well is helping drive a broader u.s. stock market turnaround interim as we report here. This trend is driven by strong market demand and positive macroeconomic news. There’s a great deal of love for the company’s stock among analysts. In fact, they’re jazzed about the new product, Agentforce, which gives corporate clients the ability to design their own customer-service oriented AI bots.
Market Dynamics and Stock Performance
Salesforce’s stock has been on a tear, up about 3% on Tuesday and Wednesday before today’s announcement helping to push the stock ever higher. As for the general mood in the market, it’s been positive. Much of this positivity is due to speculation that the White House is considering rolling back some of the tariff rates on Chinese imports. As of mid-morning, the Dow Jones Industrial Average (DJIA) was up 0.6% on the day, and the NASDAQ had shot up 1.6%, driven largely by tech euphoria.
The increase in Salesforce stock is representative of what we’re seeing across the whole market. First, the recent economic data weighed heavily. Building off of our first point, U.S. Durable Goods Orders exploded in March with a stratospheric 9.2% month-over-month gain, crushing the consensus estimate of 2%. This surprising and positive print on orders for durable goods – a very good leading indicator for strong economic activity – is probably responsible for some of that strong investor sentiment.
Salesforce’s daily stock chart shows the speed of that recent price explosion in action, helping to continue to solidify a bullish perspective among analysts.
Analyst Insights on Salesforce and Agentforce
At their bullish extremes, analysts Brad Sills and Carly Liu both saw multibagger potential in Salesforce’s prospects. They drove home the game-changing promise of Agentforce–the Fidelity/NAR Global Listing Solutions program that launched last fall. They appreciated the platform’s pricing model as fair based on existing use cases.
“[I]t appears that $0.50 to $1 per conversation is deemed a reasonable price, based on use cases today (consistent with our model assumptions for $0.50 to $0.60)” – Brad Sills and Carly Liu
Sills and Liu pointed out a few key use cases developing for Salesforce’s Service Cloud that are worth mentioning. These are shipment tracking, product information lookup, renewal sales automation. Salesforce’s strength lies in this versatility of application across disparate markets, making it highly competitive in the martech landscape.
Analysts are bullish on the company’s stock and its suite of innovative offerings. One such offering, Agentforce, is proven to dramatically improve customer engagement for corporate clients by optimizing their customers’ customer service departments.
Geopolitical Factors and Market Sentiment
Despite the strong underlying momentum in the U.S. stock market, that cloud of geopolitical wariness still hangs over such in favor of increasing trade relations with China. A spokesperson from the Chinese commerce ministry stated, “At present there are absolutely no negotiations on the economy and trade between China and the US.” This absence of discussion raises palpable concerns that may shift the balance of risk in the market in the years ahead.
The prospect of lower tariffs has investors salivating. Yet, with no formal negotiations underway, uncertainty looms as to the future of these critically important trade relations. How these economic indicators combine with the evolving geopolitical environment will continue to drive market sentiment. This will be a substantial headwind on stock performance over the next several weeks.