"For CRM stock to plunge there must be a catalyst that causes the momentum money to flee. The most likely scenario is a lack of sales growth due to strong competition. However, until the competition puts a dent in the sales growth figures, CRM stock may continue to rise and further frustrate short sellers."
Last night came the evidence of slowing sales at CRM.
Billings rose 29% in the fiscal third quarter from a year earlier. However, that missed the 33% growth estimate that most analysts expected.
In addition, CEO Marc Benioff was rather shifty in his description of whether or not sales were slowing.
According to the conference call, Benioff said he expects strong sales growth in 2012: "After taking these factors into account, we now project Q4 revenues to be in the range of $620 million to $624 million and non-GAAP EPS in the range of $0.39 to $0.40. For full year 2012, we estimate revenue in the range of $2.255 billion to $2.259 billion, representing growth of approximately 36%.
Looking forward to fiscal 2013, we currently anticipate revenue to be in the range of $2.88 billion to $2.92 billion. Again, this assumes we close the acquisition of Model Metrics in Q4. The midpoint of this guidance range implies just over -- about 28.5% revenue growth for FY '13. We'll provide you with further details about FY '13 operating model on our fourth quarter call in February."
However, in an interview with Jim Cramer, Benioff scoffed at the notion of a booking slowdown. Instead of looking at billings, Benioff thinks investors should simply follow his forward guidance blindly.