Salesforce’s future prospects and current news

As part of its New Year forecasting, investor website The Motley Fool recently took a look at prospects for Salesforce.com stock in 2007.

The Fool has long been optimistic on Salesforce, proclaiming in November 2005 alongside the release of the AppExchange platform that “The End (of Software) is Nigh” and continues to praise CEO Marc Benioff and co. with regard to their subscription model, credited with the $130 million revenue announced by Salesforce in the third quarter of fiscal year 2006.

As for Salesforce’s own forecasts of company revenue, back in December, Benioff announced an increase in its revenue outlook for its full fiscal year 2007. The company now expects revenue to be in the range of $710 million to $720 million for the fiscal year ending January 31, 2007. Salesforce.com had forecasted fiscal year 2007’s revenue to be between $700 million and $710 million.

Nevertheless, the company should see plenty of those insistent challenges on the way to further success on the spreadsheets. Analyst Tom Taulli writes that Salesforce.com must “continue to snag big-time customers,” including “more non-tech biggies” and must avoid service outages, such as those experienced in January of this year. On those outages, Taulli does note that in the last quarter, Salesforce was processing 1.6 million transactions per hour with 99.9 percent-plus reliability.

Taulli does not see major acquisition deals in Salesforce’s immediate future, figuring Benioff’s bunch to “focus on organic growth” instead and “will continue to expand from its CRM roots.” However, according to Taulli, “it is likely that Salesforce will focus on smaller deals to plug gaps in its on-demand infrastructure. That was the case in 2006, when it bought Sendia…”

The Fool’s summary? “[W]ith Salesforce.com’s leadership position, extensive infrastructure, and innovation, the company has what it takes to grow into 2007 and beyond.”

In Salesforce news, meanwhile, one story making the rounds in industry media was that of Benioff selling some 20,000 shares of common stock. The sale took place under a prearranged 10b5-1 trading plan and was filed with the Securities and Exchange Commission on Friday. In a Form 4 filed with the SEC, Benioff reported selling the shares on December 21 for $36.87 apiece. (That’s a total value of $737,400, folks.)

A Salesforce.com spokesman stated that Benioff sells 20,000 shares a day, “no matter which way the stock is moving, as part of his compensation plan.”

A 10b5-1 trading plan allows a company insider to set up a program in advance for such transactions and proceed with the transactions even if he/she comes into possession of material nonpublic information.

Salesforce.com representatives last week announced that Karl Strauss Brewing Company has successfully implemented and customized Salesforce SFA and Apex Mobile applications employing in meeting specific needs of its field sales teams.

Karl Strauss used the Apex and Salesforce product to track multi-level relationship information about current and potential beer customers (and aren’t we all potential beer customers, really?), demographic profile data, potential volume (of customers, presumably, and not A/V levels), alcohol licensing status, geographic detail, and customer contact personal information.

Salesforce.com PR folks made special note of Strauss’ development of a tailored application to track brewery vehicle repair and maintenance expenses for comparison against territorial profitability. The Apex mobile solution allows brewery field service reps to do paperwork via Blackberry.

AppExchange partner applications downloaded by Strauss Brewing include Scribe Sales Order Component, Scribe Insight for AppExchange, and Salesforce Integration for Microsoft Dynamics GP.

San Diego, Calif.-based Karl Strauss Brewing Company was founded in 1988, making it the first new brewery in the Southern California region in fifty years. Today, the brewery boasts some 22,000 square feet in floor space in San Diego and six brewery-restaurant outlets located throughout Southern California.

Tom Taulli’s “Previewing 2007: Salesforce.com” can be read in full at The Motley Fool website.