CRM
Salesforce
Recurring SaaS
★ Quality 58/100Price today
$166.89
what the market pays
Worth
$283.31
calculated cycle value
Price is 41% below its value
charlieapp.co
Unusually large discount. A gap this wide usually means the market is pricing in a risk (AI disruption, for example) that the model does not penalise. A contrarian opportunity: high upside, but high risk — not an obvious one.
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Software and subscriptions
Sales Cloud · Service Cloud · Einstein AI
$290.75
per share
How it's calculated
FCFps $11.27 post-SBC ($4.33 adjustment). IV $218 = 15x conservative FCFeco. Base IV 25x = $362. Market pays 10.9x gross FCF — historic low. PEG 0.99. Agentforce ARR $800M (+169%), 29K+ deals. FY2030 target $63B. Risk: AI CRM disruption, Informatica integration, structural SBC. BARGAIN <$174. Attractive <$261.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Recurring SaaS · vs 26 peers
You pay 11.6x times this business's cash flow; its sector median is 21.9x.
66% below what Charlie thinks it's worth (19.3x) — that gap is your safety margin.
Why Undervalued?
Its free cash flow is $15.06/share × 19.3x multiplier minus $7.44 in negative net cash = $283.31 in intrinsic value. Today's price of $166.89 is 70% below that value — there's a real safety margin to enter.
The price is 41% below the calculated value. There's a real safety margin.
The model asks for a discount to absorb estimate errors. That cushion is here.
If the business disappoints a little, the price should hold near $226.65.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$226.65
-20% off Value
🟡 Discounted
≤$269.14
-5% off Value
🟢 Today
$166.89
+70% Valor
Undervalued
Today's price offers a real discount to the calculated value. For the long run, this is the kind of entry that builds wealth.
“Price is what you pay. Value is what you get.”
— Warren Buffett
Model updated · July 2026
The business
The customer database no company dares to walk away from.
Salesforce rents software to manage customers (CRM) by subscription: companies pay per user per year. It bills $41.5B with a 78% gross margin and turns $14.4B into free cash. It collects rain or shine, month after month.
The cost of switching is its real wall: sales data, processes, and the workflows of thousands of employees live inside. Pulling them out is expensive, risky surgery, so almost no one does it. It's not a monopoly, but it's hard to divorce.
Revenue history
From $26.5B to $41.5B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $41.5B · FY2026
Of every $100 in sales, $82 goes to costs and operations; $18 is left as net profit (18% margin).
Catalysts and risks
Agentforce (its AI assistants) already adds up to $800M in recurring revenue, +169%, with 29,000 contracts closed.
Target of $63B in revenue for fiscal year 2030.
$14.4B in annual free cash allow buying back shares and reducing dilution.
AI could redesign the CRM from scratch and make the product less sticky.
The Informatica integration adds complexity and execution risk.
Structural stock-based pay (SBC) that dilutes shareholders year after year.
Charlie's note
“The market pays about 11x free cash for a business growing double digits with a 78% margin — that doesn't usually stay still for long. The honest catch: no deep moat and AI lurking, so the price is reasonable, not marked down for no reason.”
Analysis · July 2026
So when would be a good price for Salesforce?
Today it trades below what we calculate. If you want us to tell you when that changes —or when the value itself moves because the company reported— we will email you.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.