BofA Slaps Salesforce With Underperform Rating, $160 Price Target: Is the AI Story Falling Flat?

Bank of America (NYSE:BAC | BAC Price Prediction) just made one of the more contrarian calls on Wall Street regarding the enterprise software giant. Analyst Tal Liani reinstated coverage of Salesforce (NYSE:CRM) with an Underperform rating and a $160 price target, a notable bear take on a stock that still carries a consensus average price target of $268.05. For long-term holders of Salesforce, the call sharpens a debate that’s been simmering all year: is Agentforce actually translating to durable revenue growth?

The downgrade lands with Salesforce stock already under pressure. CRM shares last traded near $178.50, down 33% year to date. Liani’s view suggests further downside even after that reset.

The Analyst’s Case

Liani acknowledges that Salesforce remains “a deeply entrenched platform,” yet argues the company faces a structural reset driven by the AI transition. The bear thesis rests on three concerns: muted net new customer additions, limited upsell potential, and an “underwhelming” AI monetization pathway.

The deeper concern is pricing architecture. Agentforce and rival agentic tools could compress the per-seat subscription model Salesforce was built on, as AI agents replace seats rather than expand them. In Bank of America’s framing, the moat is the past, not the future.

Company Snapshot

Salesforce closed fiscal 2026 with $41.5 billion in revenue, up 10% year over year, and posted FY26 EPS of $12.52. The company guided fiscal 2027 revenue to $45.8 billion to $46.2 billion.

Agentforce, the AI initiative under scrutiny, reached $800 million in annual recurring revenue (ARR) with 29,000 deals closed in its first 15 months. Salesforce CEO Marc Benioff has leaned in hard, with a planned $300 million spend on Anthropic tokens in 2026.

Why the Move Matters Now

CRM stock trades at a trailing P/E ratio of 22x and a forward P/E ratio of 14x, with shares sitting between a 52-week low of $163.52 and high of $286.30. The valuation already reflects skepticism, but Bank of America’s $160 target implies that the reset isn’t finished.

Sentiment is fracturing. Starboard Value exited its Salesforce position in Q1 2026, even as institutions like DNB Asset Management increased its stake by 25%. That split tells you the bull-bear debate is genuinely live.

What It Means for Your Portfolio

For prudent investors, the Salesforce stock thesis now hinges on one question: can Agentforce monetization outrun the seat-pricing compression that Bank of America fears? The bulls can point to the $72.4 billion in total remaining performance obligations (RPO) and a fortress balance sheet, while bears have a credible structural argument.

A moderate CRM stock position size looks appropriate here, with the next earnings report serving as a key checkpoint on Agentforce ARR trajectory. The analyst downgrade doesn’t end the story, yet it raises the bar that Salesforce must clear to win back the growth premium it once enjoyed.