Salesforce Q2 FY 2022 Earnings Call Highlights

• Salesforce (NYSE: CRM)
• Slack acquisition has been closed.  
• The company's first $6 billion in revenue in a single quarter.
• 23% year-over-year (y-o-y) revenue growth with a total of $6.34 billion in revenue for the quarter.
• Operating margin of 20.4%. It's an improvement of 20 basis points year-over-year.   
• "I'm very excited that 5 out of the last 5 quarters that we've had that 20% or greater revenue growth. And that 3 of the last 5 quarters, we're having greater than 20% operating margin." - Marc Benioff, CEO.  
• Sales Cloud grew at 15% y-o-y.  
• Service Cloud is now a $6 billion business.
• Service Cloud grew at 23% y-o-y.
• Marketing & Commerce Cloud grew at 28% y-o-y.  
• "And every one of these digital transformations is also a data transformation, which is driving the unprecedented success we're seeing in Tableau and MuleSoft. Tableau is within 9 of our top 10 deals this quarter, and MuleSoft is within 8 of our top 10 deals." - Bret Taylor, COO, Salesforce.  
• Industry Cloud grew at 58% y-o-y.  
• Salesforce is aggressively launching a "Slack-first" customer 360 project. All Salesforce products will be integrated with Slack.  
• Slack's revenue grew by 39% y-o-y.    

(Source: Salesforce)

Exhibit: Marc Benioff - CEO Salesforce.  

(Source: Salesforce)

Published: August 26, 2021.

 

Metrics in the Home Health, Hospice, and Personal Care Industry

Amedisys (NASDAQ: AMED) is one of the companies serving in the home health, hospice, and personal care industry. Here are some of the metrics in the industry:

Length of Stay (LoS)

Length of stay (LOS) is an important measure for hospice care because it represents
the time available to provide appropriate and needed services near the end-of-life.

Average Daily Census (ADC)

ADC or Average Daily Census = Total patient days in a period/number of period days.

(Source: Amedisys)

MongoDB: Number of $100,000 or greater ARR Customers

Here's how MongoDB (NASDAQ: MDB) defines Annualized Recurring Revenue (ARR):

"We define ARR as the subscription revenue we would contractually expect to receive from customers over the following 12 months assuming no increases or reductions in their subscriptions."

Number of  $100,000 ARR Customers each year:

• 2016: 164
• 2017: 246
• 2018: 354
• 2019: 557
• 2020: 751
• 2021: 975

42.8% Compound Annual Growth Rate in $100K or greater ARR customers.  

(Source: MongoDB.com)

The company also closely monitors ARR expansion rate and here's is what they have to say how that:

"We also examine the rate at which our customers increase their spend with us, which we call net ARR expansion rate. We calculate net ARR expansion rate by dividing the ARR at the close of a given period (the “measurement period”), from customers who were also customers at the close of the same period in the prior year (the “base period”), by the ARR from all customers at the close of the base period, including those who churned or reduced their subscriptions. For Direct Sales Customers included in the base period, measurement period or both such periods that were self-serve customers in any such period, we also include annualized MRR from those customers in the calculation of the net ARR expansion rate. Our net ARR expansion rate has consistently been over 120%."

The ARR expansion rate is another critical metric for software subscription companies. It shows whether the customer is willing to buy more of the product and/or expand its use within the company.  

Sources:

• Form 10-K (Annual Report) FY 2021
• Form 10-K FY 2018

Does data prove that the "low" jobs additions in April '21 is due to extended unemployment benefits?

 The U.S. Chamber of Commerce tweeted that the extended unemployment benefits should be stopped given the "low" number of job additions during April 2021.

“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market."

See the full statement from our EVP @NeilBradleyDC on this morning's @BLS_gov jobs report: https://t.co/uE1557IKt3 pic.twitter.com/HIeDFwoZb5

— U.S. Chamber (@USChamber) May 7, 2021

There's lot of chatter that people are getting more in unemployment benefits and that's keeping them from taking a job. April saw addition of 266,000 jobs. In a normal economy, 266,000 jobs would be a very good report. There could be multiple reasons for why the jobs report came in well below the expectation of a 1 million jobs. 

• Many parents still have kids who are remote learning. So, they may not have the flexibility to take-up employment while they are caring for their kids.    
• Vaccines were only widely available in the middle of April. So, people who were waiting to get vaccinated before heading to work, can only now get fully vaccinated.  

The best response to US Chamber of Commerce was provided by Ben Zipperer:

Hard to single out unemployment benefits as "dampening" job growth in the lowest-wage industries when those same industries are the ones with the fastest job growth https://t.co/4OqlLBc7PW pic.twitter.com/EjXJI7aswl

— Ben Zipperer (@benzipperer) May 7, 2021

        

Equinix: Technical Set-up Looks Good

 Equinix (EQIX):

EQIX has been on BofA US 1 list for a long time. It seemed to be very expensive, finally it has come back down and I have opened a position today at $640. Actually, I wish I had picked it up yesterday.

$EQIX's Technical Set-up 

1. Trading near the bottom of the bollinger bands
2. Money Flow Indicator flashing oversold
3. RSI just coming-off of oversold territory.  
4. On-balance Volume is negative indicating oversold

Exhibit: Equinix Technical Indicators

(Source: E*Trade)

I am going to buy Total S.E. (NYSE: TOT) on any short-term weakness

Total S.E. is on Bank of America's Top Rated Stocks list. When I saw that name, I was intrigued. Why is an oil giant from Europe on this list? I have done my research and found out that they have a growing green energy portfolio for which they are not getting much credit now.  I am going to buy on any short-term weakness (below $45 may be a start) and put it away for a long time and keep collecting the dividend (6.6%).

(Source: Google)

Bank of America Adds AES Corp to US1, Removes Ameren Corp.

On August 13, 2020, Bank of America added AES Corp., (NYSE: AES) to its US-1 List. According to the bank, the US 1 list is the collection of the their best investment ideas that is subset of their buy-rated stocks. The bank has now removed Ameren (NYSE: AEE) from that list.

AES has had a huge run since May 11, 2020. It has risen from $11.87 on May 11 to $17.67 on August 17. That's a 49% gain in three months.  It may be wise to wait for a pull back before adding the stock to your portfolio.  A good entry point may be around $14.39. Currently, the money flow indicator is in overbought territory and the stock is hugging the upper part of the Bollinger Bands.  

Exhibit: AES Corp., has had a huge run 

 (Source: Tradingview)        

Disclosure: I do not own AES or Ameren

Barron's Recommends Merck, But Is it a Buy At $83.

Barron's has recommended Merck (NYSE: MRK) stating that the company does not get "enough credit". Merck is currently trading at $83.48. The price is currently hugging the upper part of the Bollinger Band. The money flow indicator is approaching over-bought territory and currently sits at 60. The MACD is flashing a buy signal. All the moving averages are currently flashing a buy. If there's any pullback, the stock may be a buy at $75 or $76.  

Exhibit: Merck May Be a Buy at $75 or $76.

 

(Source: Tradingview)

 

Exhibit: Merck Moving Averages Are Indicating a Buy

 (Source: Tradingview)

Exhibit: Merck Oscillators

 

 

(Source: Tradingview)          

Large Insider Buy at Pfizer Made Me Look At that Stock

Barron's has reported that Pfizer's Director Ronald Blaylock has made the largest open-market purchase of the stock since 2003. Mr. Blaylock paid $510,000 on August 6th for 13,000 Pfizer (NYSE: PFE) shares. The Director has paid an average price of $38.53 for the shares. The stock has been trading lower and as of Friday, August 14, 2020, it was trading at $38.06. The money flow indicator is nearing oversold territory and the MACD is flashing a sell signal. A good entry point for the stock may be around $37.70. There seems to be support for the stock at this level. If the stock breaks below $37, another entry point would be around $32.50. The stock was at that level when the money flow indicator was in oversold territory on July 24, 2020.

Exhibit: Entry Points for Pfizer 

 

 (Source: Tradingview)