Cloud software stocks rise after upbeat Salesforce results

(Reuters) - Shares of cloud software makers rose on Wednesday after Salesforce.com Inc's upbeat quarterly earnings boosted Wall Street's expectations for the fast-growing sector that came under pressure in the recent selloff in technology stocks.

Reuters November 29, 2018 04:05:11 IST
Cloud software stocks rise after upbeat Salesforce results

Cloud software stocks rise after upbeat Salesforce results

(Reuters) - Shares of cloud software makers rose on Wednesday after Salesforce.com Inc's upbeat quarterly earnings boosted Wall Street's expectations for the fast-growing sector that came under pressure in the recent selloff in technology stocks.

The company beat analysts' estimates for quarterly earnings on Tuesday and forecast 2020 revenue above expectations, helped by its lead in global customer relationship management market.

Shares of Salesforce rose 9 percent, while those of another cloud-based services firm - Nutanix Inc , which also reported strong results, were up more than 8 percent. Cloud software makers Twilio Inc and Workday Inc also rose.

At least four brokerages raised their price targets on Salesforce's stock, while Baird and Raymond James trimmed targets, citing the recent pullback in software stocks.

In October, the ISE Cloud Computing index <.CPQ> slumped more than 8 percent after six straight months of gains, as investors shed high-growth and high-valuation shares due to fears that a decade-old stock rally was coming to an end. Up to Tuesday's close, it is still down about 4 percent in November.

In its earnings call, Salesforce executives were upbeat about macro conditions and said they continue to see "huge" investments in the sector.

Monness Crespi Hardt analyst Brian White described the tone of post-earnings call as the most bullish this earnings season from a tech company of Salesforce's size.

"Co-CEO Marc Benioff's comments around strong macro in Americas and APAC (he clarified only EMEA CEO's are hinting more conservative) should remove portions of bear case around uncertain 2019," Baird analyst Rob Oliver wrote in a note.

(Reporting by Munsif Vengattil in Bengaluru)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Subscribe to Moneycontrol Pro at ₹499 for the first year. Use code PRO499. Limited period offer. *T&C apply

also read

Robinhood now a go-to for young investors and short sellers
Business

Robinhood now a go-to for young investors and short sellers

By John McCrank NEW YORK (Reuters) - Robinhood, the online brokerage used by many retail traders to pile in to heavily shorted stocks like GameStop Corp, has made an ambitious push into loaning out its clients' shares to short sellers as it expands its business. The broker had $1.9 billion in shares loaned out as of Dec. 31, nearly three times the $674 million a year earlier, and it was permitted to lend out $4.6 billion worth of securities under margin agreements, around five times bigger than the prior year, according to an annual regulatory filing late on Monday

Wall Street mixed as Apple and Tesla retreat
Business

Wall Street mixed as Apple and Tesla retreat

By Noel Randewich (Reuters) - Wall Street was mixed on Tuesday, with Apple and Tesla losing ground, while materials and energy companies climbed as investors looked toward the U.S. Congress approving another stimulus package.

Biden's SEC nominee vows review of GameStop trading issues, climate disclosures
Business

Biden's SEC nominee vows review of GameStop trading issues, climate disclosures

By Pete Schroeder and Chris Prentice WASHINGTON (Reuters) - U.S. President Joe Biden's pick to head a key market regulator promised on Tuesday a thorough review of issues raised by the GameStop Corp stock frenzy and suggested companies may have to disclose their potential risks from climate change