Salesforce leads cloud computing stocks higher as investors breathe a sigh of relief

Salesforce West Tower displays the company logo every Christmas

Takako Hatayama-Phillips/iStock Editorial by Getty Images

Salesforce (NYSE: CRM) sharing jump more than 12% in early trading on Wednesday after the cloud computing software provider posted first-quarter results that topped expectations and provided guidance that prompted investors to move in other cloud computing stocks.

Service Today (NYSE: NOW) increased by more than 3.5% behind the results, during Labor Day (NASDAQ: WDAY), Adobe (NASDAQ: ADBE) and Autodesk (ADSK) saw more moderate gains, including a 2% gain over Adobe.

Wedbush Securities analyst Dan Ives, who has an outperform rating on Salesforce (CRM) shares and a target price of $ 225 per share, noted that Salesforce (CRM) is seen as a bellwether for tech and with it reporting outside the normal schedule, investors “focused the laser” on the report and its comments to see if there were any signs of weakness. Rather, it is the opposite.

In addition to Salesforce (CRM) reporting first-quarter revenue of $ 7.41B, which was higher than analysts ’estimates of $ 7.38B in sales, Ives said in a research that the company“ gave a mixed guidance that is better than the terror of the Street and will be a key shot in the arm for the tech bulls. ”

Ivas also noted that the move to the cloud is approximately 40% complete and there is a “massive digital growth wave ahead” that will benefit Salesforce (CRM), as well as other cloud computing companies, including Microsoft (MSFT), Amazon (AMZN), Google (GOOG) (GOOGL) and Oracle (ORCL).
Earlier this month, Roth Capital analyst Richard Baldry upgraded Salesforce (CRM) stock to buy from neutral, but Wall Street did not respond.
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