What happened

Shares of Salesforce.com (NYSE:CRM) rose 11.3% in August 2018, according to data from S&P Global Market Intelligence. The enterprise cloud computing veteran named a new co-CEO to share management duties with founder Marc Benioff, followed by analysts betting on strong results in what was an upcoming earnings report at the time.

Two smiling young business people working around a shared laptop.

Image source: Getty Images.

So what

The elevation of longtime COO Keith Block to a new co-CEO role triggered a modest jump in Salesforce's share prices in early August. Later, several analyst firms raised their price targets on the company's shares in anticipation of good second-quarter results. For example, RBC Capital boosted its price target by 6%, citing strong demand for the company's services and attractive pricing power around Salesforce's artificial intelligence platform, Einstein. Jefferies pinned an 8% price target lift on a similar argument, adding that the deal pipeline looked even stronger for the second half of 2018.

When the second-quarter report made the rounds near the end of August, Salesforce crushed Wall Street's consensus earnings targets alongside a modest revenue surprise. Looking ahead, management guided third-quarter revenue above the Street consensus but set the next report's earnings target just below the analyst view. All told, Salesforce's share prices held on to the gains that had been collected in the run-up to this report.

Now what

Salesforce investors have now enjoyed a market-beating 57% return in 52 weeks thanks to a steady stream of earnings surprises. The stock is priced for continued hypergrowth, trading at 118 times trailing earnings and 40 times free cash flows. True-blue value hounds may want to stay away from this red-hot ticker for now, but Salesforce is living up to the skyrocketing ideals a growth investor finds interesting.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Salesforce.com. The Motley Fool has a disclosure policy.