Salesforce, Inc. (CRM) Intrinsic Value & DCF Valuation
Software - Application · NYSE
Current Price
$188.38
Intrinsic Value
$282.36
+33.3% margin of safety
What Is Salesforce, Inc.'s Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of Salesforce, Inc. (CRM) at $282.36 per share, compared with a market price of $188.38, a margin of safety of +33.3%. The base case assumes 9.6% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $212.41 to $363.48. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Salesforce, Inc. (CRM) Undervalued?
At the current price of $188.38, CRM trades well below the base-case intrinsic value estimate, a margin of safety above 30%. By this model the stock looks undervalued, but verify the growth assumptions match your own view before acting.
COMPETITIVE MOAT
↑Customer Ecosystem Lock-in
Salesforce's extensive suite of integrated applications creates significant switching costs for businesses. Once deeply embedded, migrating to a competitor is complex and disruptive.
↑Network Effects in AppExchange
The vast marketplace of third-party applications on the AppExchange enhances Salesforce's value proposition. More users attract more developers, creating a virtuous cycle.
↑Data and Scale Advantage
Accumulated customer data across its platform provides valuable insights and fuels AI-driven features. This scale offers a competitive edge in personalization and efficiency.
INVESTMENT RISKS
↓Intensifying Competition
The CRM market remains highly competitive with established players and nimble startups constantly innovating, requiring continuous investment in product development.
↓Integration Challenges with Acquisitions
While Informatica synergies are anticipated, the successful integration of acquired technologies and cultures is crucial for realizing their full value.
↓Economic Sensitivity of Software Spending
Enterprise software spending can be cyclical and sensitive to broader economic downturns, impacting sales growth and customer retention.
Base case
CRM base case valuation
Intrinsic Value
$282.36
Margin of safety
+33.3%
Expected annual return
+8.4%
Base case assumptions: 9.6% annual growth, 10.0% discount rate, 11x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the CRM valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Salesforce, Inc. respond.
Open DCF Calculator for CRMCompany Overview
Salesforce, Inc. is a leading provider of customer relationship management (CRM) solutions, dedicated to connecting businesses and their clientele on a global scale. At its core, the Customer 360 platform empowers organizations to create seamless, integrated experiences for their customers. The company's extensive suite of services encompasses a wide array of functionalities: Sales: Tools designed to manage sales pipelines, track leads, forecast opportunities, extract data-driven insights through analytics, and streamline the creation of quotes, contracts, and invoices. Service: Capabilities enabling companies to deliver highly personalized, trustworthy, and scalable customer support. Platform: A versatile development environment, featuring intuitive drag-and-drop tools, that allows businesses of diverse sizes, locations, and industries to build tailored applications, thereby strengthening customer relationships. Learning: An online educational platform providing accessible training to acquire sought-after Salesforce skills. Slack: A comprehensive system for team collaboration and engagement. Marketing: Solutions for strategizing, personalizing, and optimizing individual customer marketing journeys. Commerce: Offerings that unify customer interactions across various channels, including mobile, web, social media, and physical retail stores. Tableau: A complete analytics solution addressing a broad spectrum of enterprise data analysis needs. MuleSoft: An integration platform designed to unlock and connect data residing across an organization's various systems. Salesforce's offerings cater to numerous sectors, such as financial services, healthcare, life sciences, and manufacturing, among others. Beyond its core products, the company also provides professional services and conducts both in-person and online courses to certify customers and partners in the architecture, administration, deployment, and development of its services. Its solutions are distributed through direct sales channels, as well as a network of consulting firms, systems integrators, and other strategic partners. Established in 1999, Salesforce, Inc. maintains its headquarters in San Francisco, California.
Financial Metrics — CRM Stock Valuation Data
Revenue/Share (TTM)
$49.34
FCF/Share (TTM)
$16.89
ROIC (TTM)
9.2%
ROE (TTM)
14.9%
P/FCF
10.5x
EV/EBITDA
13.4x
FCF Yield
9.50%
Debt/Equity
1.22x
Based on trailing twelve-month data, CRM shows a free cash flow per share of $16.89 and a ROIC of 9.2%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 10.5x and FCF yield of 9.50% are important context metrics when evaluating CRM's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of CRM?
Salesforce, Inc. currently generates $16.89 in free cash flow per share. At the current price of $188.38, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is CRM undervalued?
CRM trades at a P/FCF ratio of 10.5x with a free cash flow yield of 9.50%. A low P/FCF means investors are paying less per dollar of free cash flow; whether that is cheap depends on the company's growth, cyclicality, and capital intensity. However, whether CRM is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value CRM stock using DCF?
To perform a DCF valuation on Salesforce, Inc.: (1) Start with the trailing free cash flow per share ($16.89) as the base, (2) project future FCF growth over 5-10 years based on Software - Application industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting CRM's risk profile — with a debt-to-equity of 1.22x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to CRM?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Salesforce, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Software - Application trends, then discounting those amounts to today's dollars. CRM's ROIC of 9.2% shows moderate capital returns.
How does WACC affect CRM stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For CRM, with a debt-to-equity ratio of 1.22x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 13.4x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See CRM PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Technology valuationsDCF and P/E value CRM with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.