Salesforce Target Price Slashed 26% to $280 Despite 37% EPS Surge
Truist trimmed its Salesforce target price by 26.3% to $280 after sector-wide valuation compression, despite Q4 FY26 diluted adjusted EPS rising 37% YoY to $3.81. Management forecasts consolidated FY27 revenue growth of 10-11% (7-8% organic), down from 10% YoY in FY26.
1. Analyst Revises Target Price
Truist lowered its Salesforce target price from $380 to $280, a 26.3% reduction, while retaining a Buy recommendation. The update reflects sector-wide valuation compression overshadowing the company’s otherwise solid quarterly results.
2. Q4 FY26 Performance
Salesforce reported Q4 FY26 diluted adjusted EPS of $3.81, up 37% YoY and surpassing consensus of $3.05. This earnings growth was driven primarily by rapid adoption of its Agentforce 360 and Slack platforms, boosting subscription revenue.
3. FY27 Revenue Guidance
Management projects consolidated FY27 revenue growth of 10-11%, with organic growth of 7-8% excluding the Informatica acquisition. This guidance marks a deceleration from the 10% YoY revenue growth achieved in FY26.
4. Sector Valuation Pressures
Analysts cited broad software sector valuation compression as the main driver of the target price cut. This pressure reflects shifting investor sentiment and the challenges high-valuation tech stocks currently face.