Artificial intelligence's potential to transform industries caused upheaval among software stocks in 2026, impacting businesses such as Salesforce (CRM -0.32%). Wall Street's fears of AI automating customer service tasks hit Salesforce shares particularly hard, since the company is a leader in the customer relationship management (CRM) market.
The stock exceeded $300 per share in 2025, but dropped to a multiyear low of $146.32 in June. While shares clawed back from that point, they remain down over 25% in 2026 through Aug. 18. Regarding Wall Street's sell-off, Salesforce CEO Marc Benioff declared, "The software bears are dead wrong."
Of course, Benioff is expected to advocate for his company, so investor skepticism is understandable. Yet several signs signal he's right. Here's why now is the time to buy Salesforce stock.
Image source: Getty Images.
Salesforce's business remains resilient
Salesforce's stock cratered in 2026, but not because of the company's performance. Rather, a massive sectorwide sell-off in software-as-a-service (SaaS) companies, dubbed the "SaaSpocalypse," was to blame. Wall Street investors believed AI would take business away from SaaS enterprises such as Salesforce. That has not proven to be the case for the CRM giant.
In its fiscal first quarter ended April 30, the company generated record revenue of $11.1 billion, up 13% year over year. The strong start to its 2027 fiscal year led Salesforce to raise its full-year revenue forecast to a range of $45.9 billion to $46.2 billion. It made $41.5 billion in the prior year. These numbers demonstrate customers still desire Salesforce's solutions.
One reason for the company's resilience is its quick embrace of artificial intelligence. It assembled its own suite of AI agents under the Agentforce brand back in 2024. Since then, Agentforce customer usage has skyrocketed. In Q1, clients used Salesforce's agentic AI 1.6 billion times, up from 14 million two years ago. The results show customers find value in Salesforce's AI.
The company's own AI use allowed it to handle double the number of customer inquiries as human agents, a testament to the value its capabilities deliver. In fact, Marc Benioff described agentic AI as "the biggest growth opportunity" for the company.
NYSE: CRM
Key Data Points
Salesforce stock appears oversold
According to Goldman Sachs CEO David Solomon, the SaaSpocalypse went overboard. This seems to be the case with Salesforce. Its strong sales growth contributed to fiscal Q1 diluted earnings per share (EPS) of $2.42, an outstanding 52% year-over-year increase.
This EPS expansion, combined with the SaaSpocalypse sell-off, makes Salesforce's stock valuation look attractive, as evidenced by a forward price-to-earnings ratio (P/E) of about 14.
CRM PE Ratio (Forward) data by YCharts.
The chart reveals the CRM leader's forward earnings multiple hovers near a multiyear low point, suggesting the stock has been oversold. As further validation, major competitor HubSpot, which also suffered share price declines in the SaaSpocalypse, sits at a higher forward P/E ratio of around 17.
Wall Street is beginning to realize that Salesforce is not threatened by AI. On Aug. 18, Citigroup raised its share price target to $204, up from $187. The combination of Salesforce's booming business, low share price valuation, and analyst upgrades makes now a good time to buy shares in the CRM leader.
