Salesforce Inc. (NYSE:CRM) shares traded lower on Friday, weighed down by a broader sell-off in enterprise software stocks. Market volatility also persisted following the midterm election results as investors continued to assess the evolving political landscape.
Despite the weakness in Salesforce shares, broader markets remained higher, with the Nasdaq gaining 2.51% and the S&P 500 advancing 1.08%.
The downward move followed an S&P Global Ratings action on Wednesday, when it lowered its issuer credit rating on Salesforce to "A" from "A+" citing higher net debt from recent acquisitions and a $25 billion debt-funded stock repurchase program.
Credit Rating Downgrade
S&P Global Ratings noted that Salesforce's capital allocation priorities reflect a higher tolerance for leverage. The rating agency highlighted recent deals including Braze for $5.7 billion, Fin for $3.6 billion and Informatica for $9.5 billion. S&P stated, "We believe the company's desire to optimize leverage will increase the risk that its net debt to EBITDA will continue to rise."
Outlook Remains Stable
S&P Global Ratings assigned a stable outlook, projecting Salesforce will keep net leverage below 2.5 times while holding its market position. The agency reported Salesforce generated $3.9 billion of Agentforce and Data360 annual recurring revenue in the second quarter of fiscal 2027, with Agentforce annual recurring revenue reaching $1.5 billion.
Technical Analysis
CRM at $216.63 is trading 8.3% below its 20-day SMA ($236.30) and 9.6% below its 50-day SMA ($239.56), which keeps the near-term trend tilted lower until price can reclaim those levels. At the same time, it's still 3.6% above the 100-day SMA ($209.22) and 9.3% above the 200-day SMA ($198.23), so the longer-term uptrend structure hasn't fully broken.
The moving-average backdrop is mixed: the 20-day SMA is below the 50-day SMA (bearish), but the 50-day SMA remains above the 200-day SMA after the Golden Cross in September, which is typically a longer-term constructive signal. Traders will likely treat this as a "pullback within a bigger base" as long as the stock holds above the 200-day area and avoids a deeper breakdown.
- Key Resistance: $252.50 - Rebound area that can act as an overhead ceiling, sitting above the 50-day/20-day zone where sellers have recently had the advantage.
- Key Support: $190 - Nearby downside level that lines up as a prior demand zone and sits above the 200-day SMA ($198.23), making it a key "line in the sand" if weakness continues