Jefferies: Salesforce, Inc. (NYSE:CRM) Is A Crowded Short Software Stock Among Institutional Investors
Summary
For software stocks, investors will pour over profitability data to determine whether the billions of dollars invested in training and testing AI as well as in business partnerships are yielding results. We’re pleased to raise our annual net new ARR target to $1.95 billion and excited to deliver on our rich product roadmap in the second half.” With AI profitability driving the second-quarter earnings season, investors were naturally ecstatic and sent the stock higher. According to Jefferies’ latest Trading Positioning Survey, 19% of institutional investors were overweight on software stocks as of October 2024, a sharp drop over July’s reading of 28% and January’s 51%. Salesforce, Inc. (NYSE:CRM)’s management shared details about its plans to increase deal value during the Q1 2025 earnings call: “Data Cloud gives every company a single source of truth and you can securely power AI insights and actions across the entire Customer 360. While we acknowledge the potential of CRM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe.