Using the industry peer median P/E multiple (trailing + forward), Salesforce, Inc. (CRM) has a fair value of $269.99 based on 8 comparable companies in the Software - Application industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| Salesforce, Inc.CRM | 177,281 | 23.8x | 15.7x |
| Micron Technology, Inc.MU | 430,894 | 50.3x | 6.9x |
| Cisco Systems, Inc.CSCO | 326,360 | 32.4x | 22.3x |
| Lam Research CorporationLRCX | 266,600 | 51.4x | 53.2x |
| International Business Machines CorporationIBM | 227,661 | 21.7x | 19.6x |
| Uber Technologies, Inc.UBER | 146,581 | 14.9x | 21.3x |
| AppLovin CorporationAPP | 132,592 | 40.2x | 25.1x |
| Intuit Inc.INTU | 120,829 | 31.8x | 18.7x |
| ServiceNow, Inc.NOW | 109,061 | 62.4x | 24.9x |
| Industry Median | 36.3x | 21.8x | |
| (*) Profit after tax | 7,457 | 11,258 | |
| Equity Value | 270,807 | 245,405 | |
| (/) Outstanding shares | 956 | 956 | |
| Fair Price | $283 | $257 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.