When it comes to earnings, Wall Street's first reactions are almost always wrong, Jim Cramer cautioned his Mad Money viewers Thursday evening. That's because it takes time to read and evaluate an earnings report, and if you rush to judgment, you risk making mistakes.
One company that is often underestimated is Salesforce.com (CRM) , which is why Cramer spoke to chairman and CEO Marc Benioff to learn more.
Benioff said Salesforce just completed their best first quarter ever, with sales, earnings and cash flow all ending better than expected.
Salesforce is also continuing its march to do well by doing good, focusing on not only profits but also social, cultural and environmental efforts. The company is actively engaged in fighting the pandemic with contact-tracing applications, a vaccine cloud and tools to help companies get their employees back to the office.
Let's check out the chart of CRM again. We looked at CRM on April 29 and recommended that "Traders could go long CRM at current levels and on a dip to $230 if available."
In this daily bar chart of CRM, below, we can see that prices corrected lower in May but held above the March lows. Prices gapped higher on Friday and closed above the rising 200-day moving average line. The slope of the 50-day line is also positive. The On-Balance-Volume (OBV) line is slowly improving from early March and confirms the price gains. The Moving Average Convergence Divergence (MACD) oscillator is now crossing back above the zero line for an outright go long signal.
In this weekly Japanese candlestick chart of CRM, below, we can see a number of lower shadows in March and May telling us that traders were rejecting the lows. Prices finished last week above the rising 40-week moving average line. The weekly OBV line turned upwards in March telling us that buyers were being more aggressive. The MACD oscillator is hugging the zero line but looks like it is ready to turn higher for a fresh outright buy signal.
In this daily Point and Figure chart of CRM, below, we can see that prices just made a new high for the move up and a $312 price target is being projected.
Bottom line strategy: Continue to hold longs recommended in late April. Traders not long could go long today on available weakness. Add to longs on a close above the February highs around $250. The $312 area is our price target for now.
(Salesforce.com is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells CRM? Learn more now.)
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