In the emerging AI software battle between Microsoft and Salesforce, investors don’t need to choose sides. Jim Cramer says he owns both. Deutsche Bank said Friday it raised its price target on Salesforce to $365 per share from $325, implying an upside of nearly 9% from Thursday’s close. Analysts cited the software maker’s new suite of artificial intelligence tools, called Agentforce, as a catalyst for further stock gains. “Our industry conversations suggest optimism around Agentforce and how it is driving renewed interest in Salesforce’s core portfolio,” the analysts said in a note ahead of Salesforce’s Dec. 3 earnings report . With Agentforce, customers can create AI agents that can take action and complete tasks without supervision, such as updating the delivery address of an order after it has already been placed. While Deutsche Bank said its industry checks indicated Salesforce signed a deal with Agentforce in the mid-seven figures, analysts still warned clients. Investors should not “over-anticipate this opportunity as it is still in its early stages” for Agentforce, they wrote. After all, Salesforce only rolled out Agentforce for general availability on October 25. Shares of Salesforce rose 1.5% on Friday, extending a more than 30% rally that began in mid-September when the company detailed Agentforce at its influential conference. annual conference. The stock traded Friday afternoon within a dollar of its all-time closing high of $341.73, set on Nov. 11. boom in generative AI that began two years ago with the launch of ChatGPT. His first initiative, branded Einstein Copilot, largely failed to make a difference. The reception to Agentforce on Wall Street has been mostly positive. With its second foray, Salesforce is now among the companies competing in the world of AI agents, which are generally considered the next frontier beyond generative AI chatbots that excel at providing written responses or creating images in response to user requests. Salesforce’s competition on this frontier intensified significantly this week when holding club Microsoft rolled out a slew of AI agent tools at Ignite, its annual developers conference. These announcements come about a year after the tech giant launched a suite of AI assistance tools called Microsoft 365 Copilot. The choice of the two AI agent companies is noteworthy because Salesforce CEO Marc Benioff has not been shy about attacking Microsoft’s competing AI offerings. During the company’s earnings release in August, for example, Benioff said Microsoft had “disappointed so many customers with AI.” In October, Benioff took to social media again to criticize the company’s AI roadmap, arguing that he “has yet to find anyone who has had a transformational experience with Microsoft Copilot.” He described Copilot as “closer to Clippy 2.0,” a reference to Microsoft’s virtual assistant that debuted in 1996. Microsoft CEO Satya Nadella did not respond directly to Benioff’s photos. However, in an interview with CNBC on Tuesday, Nadella touted Copilot as “the best-selling adopted Microsoft 365 suite of all time in our history.” He added: “You know, over 70% of Fortune 500 companies have deployed it. They’re coming back for more sequels, so we’re excited about this next phase. » Salesforce stock is up 28% year to date, compared to Microsoft’s gain of about 9% since the start of 2024. Ultimately, it’s no surprise to us that Wall Street recognized Agentforce’s significant potential. We have been touting his promises for months. In recent years, Salesforce has relied on a series of huge acquisitions to drive revenue growth, such as the 2021 purchase of Slack and. Mulesoft in 2018. If Agentforce succeeds in the long term, it would be an encouraging victory for the company’s internal innovation initiatives – and a reason to stay invested in the stock. Nonetheless, Benioff’s criticism of Microsoft is overblown, even if we acknowledge it. the mixed reception of Copilot. “For the moment, it doesn’t seem to attract (much). It turned out to be hot,” Jim said Friday. “And now it’s not hot anymore.” Still, it’s not too late for Microsoft to improve its competitive position — in fact, it’s now very early for its own AI agent tools “The big thing about Microsoft is that they are pivoting. It can get better. I don’t want to go against Microsoft,” Jim said. “They have a lot of smart people there.” (Jim Cramer’s Charitable Trust has long been CRM, MSFT. See here for a full list of stocks. ) As a subscriber to CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade Jim waits 45 minutes after a trade alert is sent before buying or selling a stock. in the portfolio of his charitable trust. CNBC TV, it waits 72 hours after the trade alert is issued before executing the trade THE INVESTMENT CLUB INFORMATION ABOVE IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AS WELL AS OUR NO OBLIGATION. OR FIDUCIARY OBLIGATION EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED FROM ANY INFORMATION PROVIDED IN CONNECTION WITH THE CLUB INVESTMENT.
Salesforce CEO Marc Benioff speaks at Salesforce Dreamforce on September 17, 2024 in San Francisco, California.
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In the emerging AI software battle between Microsoft And Sales forceinvestors don’t need to choose sides.