I keep hitting the buy button on Salesforce (NYSE:CRM | CRM Price Prediction) because the agentic AI thesis I bought into is now showing up in the financials, and the market is finally starting to notice. Shares are up 27.74% over the past month and 9.47% in the past week, but the stock is still down 20.67% year to date from a start price of $263.53. That gap between what the business is doing and what the stock reflects is exactly why my cost basis keeps working lower.
What Keeps Pulling Me Back to the Buy Button
My thesis is simple: AI capital is rotating out of pure infrastructure and into the application layer where enterprise workflows actually live, and Salesforce owns that layer. Q1 FY27 (reported May 27, 2026) is the receipt. Revenue landed at $11.133 billion, up 13.27% year over year, and EPS came in at $3.88 against a $3.1271 consensus. That is the fifth consecutive quarter exceeding EPS expectations. Marc Benioff put it plainly: “Agentic AI is the biggest growth opportunity for our customers, and for Salesforce.”
Three Reasons the Conviction Holds
First, the AI numbers are moving from slideware to actual ARR. Agentforce ARR reached $1.2 billion, up 205% year over year, and combined Agentforce plus Data 360 ARR reached nearly $3.4 billion. More than 50% of those bookings came from existing customers expanding commitments, which tells me the land-and-expand motion is intact.
Second, cash generation is doing the heavy lifting. FY26 free cash flow hit $14.402 billion, up 15.83%. That funded a $25 billion accelerated share repurchase, retiring 103 million shares, or roughly 11% of shares outstanding. There is a new $50 billion authorization behind it. Meanwhile, the dividend was raised to $0.44 per share.
Third, the valuation. CRM trades at a P/E of 24x with a forward P/E of 15x and an FCF yield of 8.41%. Total RPO of $72.4 billion, up 14%, gives me multi-year visibility.
Why CRM and Not the Usual Alternatives
The obvious reaches are Microsoft (NASDAQ:MSFT), ServiceNow (NYSE:NOW), and Oracle (NYSE:ORCL). Microsoft has broader AI exposure but trades at a much richer valuation than CRM’s 15x forward multiple. ServiceNow is a fine business, but its multiple is also richer and its dividend is thinner. Oracle sells cloud infrastructure, which is what capital is rotating away from. Salesforce is the pure-play on agentic workflows, and analyst targets sit at $243.98 against today’s $209.06.
A Risk I’m Not Waving Off
Noncurrent debt jumped to $39.3 billion from $10.4 billion a year ago to fund the ASR, and management flagged an approximately five point headwind to operating cash flow growth from the associated interest expense. That is real. It is offset by the retired share count itself. I am comfortable with leverage taken to buy back 11% of the float when the business is compounding cash flow at a mid-teens rate.
Why the Buy Button Stays Active
Management is guiding to $45.9 billion to $46.2 billion in FY27 revenue and a $63 billion FY30 target. Tokens processed hit 28.6 trillion, up 152% quarter over quarter. When the underlying business compounds this hard and the price sits below where it started the year, I stop asking whether to buy and start asking how much.
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