£10,000 invested in Salesforce stock 1 year ago is now worth…

Salesforce (NYSE:CRM) stock’s up 9% over the past year. However, the pound’s also up around 9% versus the dollar over the period. And as Salesforce shares are listed in dollars on the US exchange, that means a £10,000 investment a year ago would be worth pretty much the same today.

Agentic AI leader

Salesforce is a leading global cloud software provider. It’s also uniquely positioned at the forefront of the agentic artificial intelligence (AI) revolution in enterprise technology.

In recent months, Salesforce’s leadership in agentic AI — systems that can autonomously execute complex workflows and enhance productivity — has become central to its growth narrative, as highlighted by management’s focus on building a unified enterprise AI platform that integrates data, applications, and automation.

And on 26 June, CEO Marc Benioff said that 30-50% of the company’s work was being undertaken by AI. In other words, it’s practicing what it preaches.

Valuation remains key

From a valuation perspective, Salesforce currently trades at a forward price-to-earnings (P/E) of 23.7 times for 2026. That’s only slightly above the information technology sector median of 23.4 times. And it’s significantly below its five-year average of 40.5 times — a 41% discount to its historical norm. 

The forward price-to-earnings-to-growth (Non-GAAP) ratio stands at 1.36. That’s notably better than the sector average of 1.79 and well below the company’s own five-year average, indicating that Salesforce’s projected earnings growth’s being offered at a relative discount to its peers and its own history.

Other valuation metrics, such as EV-to-EBITDA (forward) at 15.6 times and EV-to-EBIT (forward) at 17.9 times, are also below Salesforce’s historical multiples, further supporting the view that the stock’s trading at attractive levels relative to its long-term averages.

Salesforce’s capital structure’s another point of strength. The firm has $17.4bn in cash against $12bn in total debt, the company maintains a net cash position, providing flexibility for continued investment in AI, strategic acquisitions, and shareholder returns. 

Collectively, these figures are very encouraging. And personally I believe the company’s growth trajectory is under-appreciated by the market. Looking around the market, several companies that are expected to be winner in AI, like Palantir, trade with crazy valuations — 247 times forward earnings and 7.9 PEG.

It’s got all the hallmarks on the next big winner, without the valuation premium.

The bottom line

A key risk for Salesforce lies in execution. While I believe it will succeed, integrating AI’s a substantial investment and it’s going to face stiff competition. Microsoft is also listed among the potential winners in this agentic AI sector, but they’re a lot bigger and have a lot more cash at their disposal, as well as an even larger customer base.

However, I believe Salesforce offers long-term promise as a winner in this AI revolution. It’s one of my larger holdings, and it’s certainly worth considering.

The post £10,000 invested in Salesforce stock 1 year ago is now worth… appeared first on The Motley Fool UK.

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James Fox has positions in Salesforce. The Motley Fool UK has recommended Microsoft and Salesforce. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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