Bank of America Raises Salesforce Rating Two Notches to Buy

what happened

Dow Jones Newswires reports that Bank of America analyst Tal Liani raised Salesforce two ratings steps, moving the stock from Underperform to Buy. He lifted the price target from $160 to $285. Salesforce rose 4.1% to $238.50 in Monday’s premarket after gaining 0.6% to $229.13 on Friday.

The shares were down 14% for the year through Friday’s close as investors worried that artificial intelligence could disrupt software offerings. However, Salesforce has advanced 53% since closing at $150.12 on June 22.

Liani said large enterprises are unlikely to replace platforms containing their business logic, data, workflows and compliance frameworks. In his view, AI could instead increase reliance on those systems. He also cited Salesforce’s AI strategy, strong free-cash-flow generation and the prospect of accelerating revenue growth.

The analyst said AI revenue remains small, while slower-than-expected adoption is the main near-term risk. In June, Barron’s stopped recommending Salesforce after selecting it as a stock pick in December. The shares are up 34% since closing at $170.92 on June 10.

why it matters

The upgrade signals a more constructive view of AI-related risks facing software companies. For Salesforce, investors will continue to focus on enterprise AI adoption and whether it supports the expected recovery in revenue growth.

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