Bullish Trendline Could Prop Up Salesforce.com Stock

Year-to-date, CRM is already up nearly 30%

Digital Content Manager
Nov 23, 2021 at 3:05 PM
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Salesforce.com, inc. (NYSE:CRM) is down 2.6% at $289.11 at last check, brushing off three price-target hikes, including ones from Jefferies and BofA Global Research to $360 from $325 and $330, respectively, which is a 28% premium to last session's close. The analyst at Jefferies said a partner survey suggested the pandemic is driving sustained demand for digital transformation, with 55% of respondents noting their pipelines improved in the last three months.
 
While the security has cooled from its Nov. 9, all-time high of $311.75 in recent weeks, it looks like it could could still add to its 29.9% year-to-date lead over the next few weeks, as this latest pullback has placed the equity near a key trendline with historically bullish implications.
 
More specifically, Salesforce.com stock just came within one standard deviation of its 40-day moving average, after a long time spent above this trendline. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, at least seven similar signals were seen over the last three years. CRM enjoyed a positive return one month later in 86% of cases, averaging a 3.9% gain. From its current perch, a comparable move would place the security back above $300 -- just shy of its record peak.

 

CRM 40 Day

 

What's impressive about today's bull notes is that analysts were already firmly bullish towards Salesforce.com stock, with 24 of the 27 in question carrying a "buy" or better rating, while the remaining three said "hold." Plus, CRM's 12-month consensus target price of $324.34 is an 12.2% premium to current levels.

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