Salesforce.com Inc. (NYSE: CRM) is a provider of software-based customer relationship management (CRM) solutions to large and small corporations. An early adaptor to cloud-based computing, the company was an innovator of selling software as a service that is accessed online, as opposed to being hosted on a client’s computer system.
The firm has been rapidly expanding the range and variability of its software offerings to serve the needs of companies of all sizes. It had a revenue of $17.1 billion in 2020 and a market cap of $195.44 billion as of March 19, 2021. Its main competitor is Oracle Corp. (NYSE: ORCL), whose chairman, Larry Ellison, was an early investor in Salesforce.com.
On March 20, 2018, the company announced its plan to acquire MuleSoft, Inc. (MULE) for $6.5 billion, which represented a 36% premium over the closing price on March 19, 2018. The acquisition was completed on May 2, 2018.
Salesforce.com has been a popular holding for many mutual fund portfolio managers. The five largest mutual fund investors in the company’s stock hold a combined total of around 10% of the firm’s outstanding shares. All data is as of Q1 2021.
|Top Mutual Fund Holders of SalesForce.com as of Q1 2021|
|Holder||Shares||% Out||$ Value|
|Vanguard Total Stock Market Index Fund||24,352,921||2.64%||5,419,255,510|
|Fidelity Contrafund Inc||20,226,665||2.20%||4,562,326,557|
|Vanguard 500 Index Fund||18,334,310||1.99%||4,079,934,004|
|SPDR S&P 500 ETF Trust||9,259,661||1.01%||2,088,609,135|
|Price (T.Rowe) Blue Chip Growth Fund Inc.||8,454,102||0.92%||1,881,291,318|
1. Vanguard Total Stock Market Index Fund (VTSMX)
The Vanguard Total Stock Market Index Fund ("VTSMX") is a passively managed index fund. It tracks the CRSP US Total Market Index, which includes all companies regularly traded on NASDAQ and the New York Stock Exchange. The four-star Morningstar-rated fund has assets under management (AUM) of more than $1 trillion, an expense ratio of 0.14%, a turnover rate of 8%, and a five-year annualized total return of 16.5% (as of Q1 2021). It owns the most shares—2.64% of Salesforce.com’s common stock.
2. Fidelity Contrafund (FCNTX)
The Fidelity Contrafund ("FCNTX") is a large-cap growth fund that seeks capital appreciation. The three-star Morningstar-rated fund has $131 billion of AUM, an expense ratio of 0.86%, a 32% turnover rate, and a five-year annualized total return of 19.1% (as of March 2021). Its comparative index is the S&P 500 Index, which it slightly outperforms on a regular basis. Fidelity Contrafund is the second-largest mutual fund investment in Salesforce, with 20.2 million shares. The fund owns 2.20% of the firm’s outstanding shares.
3. Vanguard 500 Index Inv (VFINX)
The Vanguard 500 Index Inv ("VFINX") is a large-blend growth fund that tracks the performance of the S&P 500. The four-star Morningstar-rated fund has AUM of $202.6 billion, an expense ratio of 0.14%, a 4% turnover rate, and a five-year annualized total return of 12.80% (as of March 2021). The fund owns 18.3 million, or 1.99%, of Salesforce.com’s shares.
4. SPDR S&P 500 ETF (SPY)
The SPDR S&P 500 ETF (SPY) is the first-ever ETF introduced in the U.S. public market and remains one of the most popular to this day. As of Q1 2021 SPY is the fourth-largest CRM holder with 9.26 million shares. This accounts for about 1% of the company's outstanding shares.
5. T. Rowe Price Blue Chip Growth Fund (TRBCX)
The T. Rowe Price Blue Chip Growth Fund ("TRBCX") invests in the common stocks of large and medium-sized blue-chip companies. The four-star Morningstar-rated fund has AUM of $94.3 billion, an expense ratio of .69%, a turnover rate of 29%, and a five-year annualized total return of 21.4% as of March 2021. The fund holds just under 1% of Salesforce.com’s outstanding shares.
Salesforce. "Salesforce FY 2020 Annual Report," Page 2. Accessed March 21, 2021.
MarketWatch. "Salesforce.com Inc.." Accessed March 21, 2021.
Salesforce. "News & Insights: Salesforce Signs Definitive Agreement to Acquire MuleSoft." Accessed March 21, 2021.
Salesforce. "News & Insights: Salesforce Completes Acquisition of MuleSoft." Accessed March 21, 2021.
Morningstar. "VTSMX." Accessed March 22, 2021.
Morningstar. "FCNTX." Accessed March 22, 2021.
Morningstar. "VFINX." Accessed March 22, 2021.
Morningstar "SPY." Accessed March 22, 2021.
Morningstar. "TRBCX." Accessed March 22, 2021.