Salesforce.com (CRM) stock dropped 1.3% to rest at a critical technical support level on Monday.
Shares of the customer relationship manager stock fell after news of a Wall Street downgrade hit the wires this morning.
Analysts from Guggenheim downgraded the stock from a “neutral” to “sell” rating. The analysts also lowered the stock’s target price to $247. That new target price is 25% lower than today’s trading price.
Shares of Salesforce.com have traded with additional volatility as investors become more concerned with the company’s outlook for 2025.
Higher interest rates and potential market volatility have been reason for several companies to hold off on signing new business agreements with Salesforce. These problems arose in mid-2024 as the company saw a decline in year-over-year revenue.
That revenue decline has continued through the most current quarter. Salesforce.com reported comparable revenue for its most recent quarter of 8.3%. That revenue growth was the lowest in five years.
Today’s price drop lands Salesforce.com’s stock on it’s 50-day moving average. The trendline is in a bullish pattern reflecting the stock’s strength since October.
A break below the stock’s 50-day may increase selling pressure as momentum turns negative.
Saleforce.com shares have tested this price level three times over the last two months. This means a break below $325 would be a psychological mark against the stock that would also increase selling pressure.
While Slaesforce.com shares remain in a long-term bullish trend, the stock is likely to target $300 over the next 4-6 months.
