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Salesforce CEO Continues Selling The Stock (NYSE: CRM) As Part Of Plan

Analyst Team trader
Updated 31 May 2024

Marc Benioff, the CEO of Salesforce, Inc (NYSE:CRM), has seen his shareholding in the firm reduce by more than 12% since the start of this year, as he continues to sell down some of his holdings (via automated sales) in tranches of 15,000 shares at a time.

The latest share sale from Mr Benioff reported on May 28th shows 15,000 shares of Salesforce stock, totalling approximately $4,039,800.00 being disposed of. This transaction has adjusted his ownership to 12,437,327 shares, which have an estimated value of about $3,349,620,907. Having ended 2023 with 14,191,166 shares, the Salesforce CEO seemingly started this process of automated sales on 3rd July 2023 with personal holdings noted of 16,473,609 shares at the time. Whilst the reduction is notable, it is not unusual to see founders or co-founders reduce holdings over time.

The longevity of the plan removes timing from the equation, but the most recent sale gains more attention due the recent Salesforce earnings surprise for its most recent quarter. Markets closely observe such earnings reports as they can have a considerable impact on stock performance and investor sentiment, and despite Salesforce beating on EPS, the sales growth is showing signs of slowing and put a mini shockwave into the stock price, dropping almost 20% in yesterday's session.

Looking at Salesforce stock price over the last 12 months shows some notable volatility, as despite climbing strongly pre May 29th (up 20% in 12 m before the earnings induced drop), holders of CRM shares now find the price 14.88% in the red through 2024 so far.

The 52 week range of the stock shows a low of $193.68 against a high of $318.71 achieved just 2 short months ago. With the price now far closer to the lower end of this range than the top, you have to wonder what it will take to shift sentiment in the short term

In terms of target prices and ratings, a variety of financial firms have weighed in on Salesforce stock, with the consensus firmly positive. With a swathe of price target reductions in the wake of yesterday's trading session coming through, this is a changing narrative from the street, but one which still backs the outlook on the firm. Deutsche Bank are one example of analysts dropping their forecast from a lofty $350, to a still very healthy $300. The firm keep their ‘Buy' rating in tact, as do many others, but time will tell how this one plays out.

As a global leader in Customer Relationship (CRM) technology, Salesforce's business model revolves around connecting companies with their customers across various fronts like sales, analytics, artificial intelligence, and customer support. The performance of such a company's stock is, therefore, significant, as it not only represents its own health but also the state of technological adoption in commerce worldwide.

All in all, whilst Mr Benioff's reduction in shareholdings over the past year, and most recent sale pre dip are worth looking at, his personal holding in the firm is still huge. Selling into the market via automated sales is one of the best ways to avoid any conflicts, or perceived conflicts over timing, and the duration of the plan also alleviates concern.

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The AskTraders Analyst Team features experts in technical and fundamental analysis, as well as traders specializing in stocks, forex, and cryptocurrency.