Not long ago, enterprise customer relationship management (CRM) software provider Salesforce (NYSE:CRM) was a darling of the technology sector. In 2020, during the height of the COVID-19 pandemic, Salesforce celebrated its inclusion in the prestigious 30-member Dow Jones.
Back then, it wouldn’t have been difficult to convince people that Salesforce stock is one of the best assets to hold for the next 10 years. Lately, however, the tide of sentiment has turned against Salesforce. So, is the cloud software giant on the brink of collapse?
Anything is possible, but value-focused traders and contrarian investors should consider the CRM stock rout as a buying opportunity. Or, at the very least, you could start scaling into a Salesforce share position as there’s a major event coming up soon.
Below $200 Is a Steal
The five-year chart of Salesforce stock might look aimless and random at first glance. Bear in mind, though, that charts can tell us where the buyers tend to step in.
This five-year chart provides some clues about how far CRM stock could travel in either direction. The stock was double its current price just a year ago, and it has rallied above $300 at least three times in the past.
Recent history suggests that it’s difficult to keep Salesforce stock below $200 for very long. The interest-rate malaise of 2022 pushed CRM stock below $200 for a while, but just holding on and waiting for a recovery proved to be a highly profitable strategy.
In any case, the risk-to-reward profile is more favorable now that Salesforce shares trade below $200. Partially due to the reduced share price, Salesforce now trades at 24.23 times trailing 12-month earnings, indicating a reasonable valuation for a mega-cap technology business nowadays.
Scale In and Hold for a Decade
It has been a while since Salesforce released a quarterly earnings report with forward guidance. You may recall that in December, Salesforce raised its revenue and adjusted profit guidance for fiscal 2026.
At that time, enterprise (i.e., business) adoption of agentic artificial intelligence (AI) for administrative tasks was gaining momentum. Amid this optimistic backdrop, Salesforce CEO Marc Benioff reported, “Our Agentforce and Data 360 products are the momentum drivers, hitting nearly $1.4 billion in ARR—an explosive 114% year-over-year gain.”
It’s hard to argue with 114% growth in just a year. Nevertheless, just a couple of months later, the market is suddenly turning against certain AI software firms, including Salesforce.
We’ll discuss the souring sentiment shift in a moment, but for now, investors should be aware of an upcoming major event. Specifically, Salesforce will release its fourth-quarter and full fiscal 2026 results on or near February 25.
If you’d like to start a small share position in Salesforce to hold for a decade, that’s perfectly reasonable. At the same time, it’s prudent to wait until the upcoming data release to take a larger Salesforce stock position.
Overall, it’s important to be nimble even if you’re bullish about CRM stock for the long term. Salesforce eliminated fewer than 1,000 jobs not long ago, and this may benefit the company in the long run but in the short term, stock traders may get nervous and unload their shares. Consequently, you’ll want to have some cash available to pick up some shares at reduced prices.
The Panic Is Overblown
Lately, the main excuse for traders to sell their Salesforce stock shares isn’t layoffs. Rather, it’s fear over AI companies like Anthropic and OpenAI developing their own CRM software to rival Salesforce.
Not everyone is overly fearful about this threat, however. For example, William Blair analyst Jason Ader feels that the panic is “overblown for a large part of the software industry.”
The point is that “software indexes are just getting sold” wholesale, and it’s not necessarily a problem that’s specific to Salesforce. Again, below $200 is a great place to be a buyer since CRM stock survived panic phases in the past.
Today, the panic is about companies like Anthropic and OpenAI threatening Salesforce. The next time around, the sellers will find a different excuse to rotate out of Salesforce stock for a while.
Many people call themselves true contrarians or value seekers, but they rarely practice what they preach when share prices fall fast. If you’re really afraid of further declines, you could just scale into a CRM stock position gradually and wait for more data.
Besides, if your expected hold time is a full decade, then you shouldn’t worry too much about the bumps in the road. Panic phases will come and go, but in all probability, Salesforce will still be a strong CRM software competitor and revenue generator in 10 years’ time.