Motley Fool: Managing customers
Salesforce (NYSE: CRM) launched a cloud-based customer relationship management (CRM) platform in 1999, becoming the first company to adopt cloud computing on a large scale.
Today, with a recent market value near $160 billion, it offers productivity software for marketing, commerce, sales and customer service, as well as tools for workflow automation, data analytics and artificial intelligence (AI).
Salesforce has turned its capacity for innovation into a powerful brand. It captured 24% market share in CRM software last year – more than the next four competitors combined – marking its ninth consecutive year as the industry leader.
Its second-quarter revenue climbed 22% over year-ago levels to $7.7 billion, with management authorizing the repurchase of up to $10 billion worth of shares.
Looking ahead, investors have good reason to be bullish.
Salesforce puts its total addressable market (TAM) at $290 billion in 2026, meaning it has only captured about 10% of its future TAM so far.
It can grow by further penetrating large corporations, offering its platform to small and medium-sized companies, moving into new industries and expanding into overseas markets.
Meanwhile, shares recently traded at a forward-looking price-to-earnings (P/E) ratio of 28, well below Salesforce’s five-year average of 58.
This growth stock is worth a closer look. (The Motley Fool owns shares of and has recommended Salesforce.)
Ask the Fool
Q. What are “government securities”? – Q.R., Las Cruces, New Mexico
A. They’re investments offered by a government, bringing in money that can be spent on anything from military operations to infrastructure renewal.
Issuing these securities is often preferable to raising taxes or cutting spending somewhere.
In the United States, government securities include Treasury bills (maturing in a year or less), notes (maturing in two to 10 years) and bonds (maturing in 20 or 30 years).
They’re considered extra safe investments, since they’re backed by the U.S. government, with little risk of default.
They do, however, tend to offer relatively low interest rates.
You can buy or sell Treasuries via many brokerages, or at TreasuryDirect.gov.
Q. How do I set up a stock watch list? – H.P., Knoxville, Tennessee
A. Make a list of the stocks you’d like to keep an eye on – ones that seem like promising investments.
You can set up a watch list, entering each stock into a virtual portfolio, at several sites; these include Finance.Yahoo.com, CNBC.com, MarketWatch.com and perhaps even your brokerage.
A watch list is especially effective if you can enter a starting (or “purchase”) price.
This might be the price when you first noticed the stock, or its price on the day you added it to the portfolio.
After that, any time you check the list, you’ll see how much each stock has risen or fallen from those levels.
Research and follow the companies on your watch list to get to know them well.
Monitoring your list will help you notice when a company of interest falls in price significantly, which can be a great buying opportunity.
Just be sure to research why a stock fell to make sure any problems seem temporary.
My dumbest investment
My dumbest investment was buying things on credit. That debt kept me from having the resources to invest earlier in my life. – N.L., online
The Fool responds: Debt is a tricky thing. Some of it is almost unavoidable, such as when you want to buy a home and need a mortgage, or if you have to borrow some money for college or a car.
Such debts can be OK if they charge reasonable interest rates and if you’ll be able to pay them off on time. Other debts, such as from the overenthusiastic use of credit cards, can be hazardous to your wealth.
Imagine owing, say, $40,000 on a credit card, and being charged, say, 20% on it – many people owe more than that, and many cards charge more than that, too.
(Some cards charge 25% interest or more!) You’d be forking over a whopping $8,000 every year in interest alone.
Clearly, it can be hard to achieve any financial goals if you’re spending $8,000 a year on debt. It’s critical to get out and stay out of high-interest-rate debt.
Once you’re free of it, that interest you would have paid can go into retirement investments, or help you meet other financial goals.
When tempted to buy something on credit, take a day or two to cool off – you may not be so eager to buy it later.