If you thought the FB drop was bad, wait until everybody learns about what’s been going on with Salesforce

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by shawnee_

Let’s forget for a minute that going into this, $CRM was already the most atrociously overvalued company in the market. Who or whatever has pumped $10 Billion of fake value into this company over the last month or two is obviously insane. GAAP earnings are being swept under the rug, and the accounting people are making up EPS numbers as they go.

There is no justification for this kind of market cap ($110 Billion now?) for a company that literally has no appreciable assets, no reason for its customers to not switch to cheaper or better alternatives. It should have flat to negative forecasting, not these baloney numbers it comes up with. Whoever buys this stock as an investment obviously has NO EXPERIENCE WITH SOFTWARE. Anybody who has worked in the industry knows: the more software you add to software, the bulkier and more complex and expensive it gets to manage. You’re not paying for the “software” you’re paying for the “service” of waiting in line to get service. Anybody using CRM is literally paying that company to manage its own unwieldy complexity. Customers are paying what is probably a 50X premium for something that doesn’t deserve a 50X premium.

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On the balance sheet, its intangible assets are something like 40+ billion? That is NOT COUNTING SHAREHOLDER EQUITY. Remember the accounting equation?

“Assets = Liabilites + Owners’ Equity”

The assets piece is being manipulated and false information is being presented to shareholders. EPS numbers touted are not GAAP compliant; instead they are reporting past revenue as current revenue (accounting tricks), and forecasting future revenue based on that already false premise.

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Also look at its short-term debt obligations, which are already ridiculous (90-something percent of its intangibles). And yet, it somehow manages to get way below market-rate loans courtesy of JP Morgan so it can do “acquisitions” of companies and pay the founders of those companies worthless stock. The CEO and executive insiders then proceed to dump hundreds of millions of dollars in stock per week.

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To put it in the words of one redditor

“We’re also moving away from Salesforce, but mostly because it’s shit and their API is even shittier.”

Source is from this thread discussing this story: thehill.com/latino/399156-coffee-shop-rejects-offer-to-serve-drinks-for-company-with-border-patrol-contract.

So let’s presume that this $10B has been because of its coziness and taking taxpayer money in deals with the Trump administration to cage humans and enforce the highly controversial CBP.

True market cap is probably $15-18 Billion on its best day. Salesforce needs to be punished severely by people who can do math and prove its business model is a fraud.



Disclaimer: Consult your financial professional before making any investment decision.


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