Stock Analysis on Net

salesforce.com inc. (NYSE:CRM)

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Economic Value Added (EVA)

Microsoft Excel LibreOffice Calc

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Economic Profit

salesforce.com inc., economic profit calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Net operating profit after taxes (NOPAT)1
Cost of capital2
Invested capital3
 
Economic profit4

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2021 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= × =

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. salesforce.com inc. economic profit decreased from 2019 to 2020 but then slightly increased from 2020 to 2021.

Net Operating Profit after Taxes (NOPAT)

salesforce.com inc., NOPAT calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Net income (loss)
Deferred income tax expense (benefit)1
Increase (decrease) in allowance for doubtful accounts2
Increase (decrease) in unearned revenue3
Increase (decrease) in equity equivalents4
Interest expense
Interest expense, operating lease liability5
Adjusted interest expense
Tax benefit of interest expense6
Adjusted interest expense, after taxes7
Net operating profit after taxes (NOPAT)

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in allowance for doubtful accounts.

3 Addition of increase (decrease) in unearned revenue.

4 Addition of increase (decrease) in equity equivalents to net income (loss).

5 2021 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =

6 2021 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =

7 Addition of after taxes interest expense to net income (loss).

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. salesforce.com inc. NOPAT decreased from 2019 to 2020 but then increased from 2020 to 2021 exceeding 2019 level.

Cash Operating Taxes

salesforce.com inc., cash operating taxes calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Provision for (benefit from) income taxes
Less: Deferred income tax expense (benefit)
Add: Tax savings from interest expense
Cash operating taxes

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. salesforce.com inc. cash operating taxes increased from 2019 to 2020 but then slightly decreased from 2020 to 2021 not reaching 2019 level.

Invested Capital

salesforce.com inc., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel LibreOffice Calc
Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Finance lease liabilities, current
Current portion of debt
Noncurrent debt, excluding current portion
Finance lease liabilities, noncurrent
Capital lease obligations
Operating lease liability1
Total reported debt & leases
Stockholders’ equity
Net deferred tax (assets) liabilities2
Allowance for doubtful accounts3
Unearned revenue4
Equity equivalents5
Accumulated other comprehensive (income) loss, net of tax6
Adjusted stockholders’ equity
Marketable securities7
Invested capital

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of unearned revenue.

5 Addition of equity equivalents to stockholders’ equity.

6 Removal of accumulated other comprehensive income.

7 Subtraction of marketable securities.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. salesforce.com inc. invested capital increased from 2019 to 2020 and from 2020 to 2021.

Cost of Capital

salesforce.com inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2021-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2020-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2019-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 33.80%) =
Operating lease liability4 ÷ = × × (1 – 33.80%) =
Total:

Based on: 10-K (reporting date: 2018-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 35.00%) =
Operating lease liability4 ÷ = × × (1 – 35.00%) =
Total:

Based on: 10-K (reporting date: 2017-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Debt and finance lease liabilities3 ÷ = × × (1 – 35.00%) =
Operating lease liability4 ÷ = × × (1 – 35.00%) =
Total:

Based on: 10-K (reporting date: 2016-01-31).

1 US$ in millions

2 Equity. See details »

3 Debt and finance lease liabilities. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

salesforce.com inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Selected Financial Data (US$ in millions)
Economic profit1
Invested capital2
Performance Ratio
Economic spread ratio3
Benchmarks
Economic Spread Ratio, Competitors4
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International Business Machines Corp.
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Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
ServiceNow Inc.
Visa Inc.

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

1 Economic profit. See details »

2 Invested capital. See details »

3 2021 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. salesforce.com inc. economic spread ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.

Economic Profit Margin

salesforce.com inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jan 31, 2021 Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016
Selected Financial Data (US$ in millions)
Economic profit1
 
Revenues
Add: Increase (decrease) in unearned revenue
Adjusted revenues
Performance Ratio
Economic profit margin2
Benchmarks
Economic Profit Margin, Competitors3
Accenture PLC
Adobe Inc.
Autodesk Inc.
Automatic Data Processing Inc.
Fidelity National Information Services Inc.
Fiserv Inc.
International Business Machines Corp.
Intuit Inc.
Mastercard Inc.
Microsoft Corp.
Oracle Corp.
PayPal Holdings Inc.
ServiceNow Inc.
Visa Inc.

Based on: 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-01-31), 10-K (reporting date: 2018-01-31), 10-K (reporting date: 2017-01-31), 10-K (reporting date: 2016-01-31).

1 Economic profit. See details »

2 2021 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenues
= 100 × ÷ =

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. salesforce.com inc. economic profit margin deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level.