2025’s Dow Jones Laggard Set to Outperform Market in 2026

Basio badr

ago 37 minutes

Salesforce has recently faced challenges but remains a strong long-term investment option. The company’s stock has declined sharply in 2025, down by 31% year-to-date. In comparison, the Dow Jones Industrial Average has seen a noteworthy 12.2% increase this year.

Dow Jones Laggard Set to Outperform Market in 2026

Among the Dow’s components, Salesforce stands out as a notable laggard. Since its addition to the Dow on August 31, 2020, Salesforce stock has dropped 14.9%, while the Dow has surged by 66.5%. This disparity highlights the unique challenges Salesforce faces, which investors should consider moving forward.

Salesforce’s Struggles and Future Outlook

While Salesforce is recognized for its customer relationship management (CRM) software, it has struggled to maintain growth amid a shifting market environment. The company also owns popular platforms such as Slack and Tableau, which play a significant role in its service offerings. However, the rise of artificial intelligence (AI) has complicated the SaaS landscape.

Current Stock Performance: Salesforce is currently priced around $238.56.
Market Cap: Approximately $223 billion.
Revenue Growth Expectation: A modest forecast of 9% for fiscal 2026.

The Impact of AI on Salesforce

The integration of AI tools through its platform, Agentforce, represents a strategic shift for Salesforce. This tool enables users to optimize their sales processes, potentially increasing efficiency. However, Salesforce’s heavy reliance on user numbers poses a challenge, as AI can enable companies to operate with fewer licenses.

Salesforce’s Financial Performance

Despite its current difficulties, Salesforce has significant financial strengths. The company features a solid operating margin of 21.2% and a forward price-to-earnings ratio of 20.3. Additionally, it has begun paying dividends since 2024, currently yielding 0.7%. This financial stability underlines its potential as a resilient investment.

Investor Considerations

Salesforce is trading at one of its lowest price-to-sales valuations in a decade, presenting a potential buying opportunity for investors. However, upcoming earnings calls will be critical for understanding the company’s strategies for leveraging AI while maintaining margins.

In conclusion, with Salesforce’s stock positioned at an attractive valuation, it could outperform the market in 2026, reflecting a potential turnaround for this established player in the SaaS industry. Investors should remain vigilant as the landscape continues to evolve. Analyzing forthcoming performance metrics will be essential for making informed decisions.