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Key Takeaways

• Salesforce shares lost ground Thursday on the company's weaker-than-expected earnings and outlook, but Morgan Stanley analysts said they expect the stock to climb this year.

• Several analysts cited the early success of Agentforce, Salesforce’s platform that allows clients to build custom AI agents.

• Bank of America called the stock a top pick to deliver growth at a reasonable price.

Salesforce (CRM) shares lost ground Thursday on the company's weaker-than-expected earnings and outlook, but Morgan Stanley analysts said they're still bullish on the stock, anticipating it has “significant room for upside” this year.

Morgan Stanley pointed to the early growth of Agentforce, Salesforce’s new platform that allows clients to build custom AI agents. Since it was made generally available in October, Salesforce has closed more than 5,000 Agentforce deals, including 3,000 paid transactions.

The analysts said shares could "likely climb from here," reiterating an “overweight” rating and $405 price target, suggesting about 46% upside from Thursday's intraday price. “We would be strong buyers of Salesforce ahead of these potential improving numbers,” they said.

Monetizing Agentforce is “still in the early stages,” analysts at Wedbush said, suggesting strong potential for growth. The cloud services company is “taking a prudent approach to scaling the Agentforce that will pay off over the long-term with the AI Revolution now entering the software phase,” they said, and maintained a price target of $425.

Bank of America lowered its price target to $400 from $440, telling clients investors may have to wait until fiscal 2027 to see material revenue contributions from Agentforce. However, BofA said it still views the stock as a top pick and quality GARP (growth at a reasonable price) option.

Shares of Salesforce were down about 3% at $298.55 in Wednesday afternoon trading, and have lost about 11% of their value since the start of the year.

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