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Shares of the cloud-based software company Salesforce (CRM -7.35%) were falling today after two analysts lowered their price target for the company’s stock. Additionally, Slack’s CEO said today that he’s leaving the company. Slack was purchased by Salesforce last year.
As a result, Salesforce’s share price was down by 7.4% as of 2:45 p.m. ET.
Credit Suisse analyst Phil Winslow lowered his price target for Salesforce stock to $225 down from $250 today and kept an outperform rating on the stock.
Additionally, Citi analyst Tyler Radke lowered his price target for Salesforce to $164 down from $170, and kept a neutral rating on its shares.
Both analysts mentioned the fact that Salesforce co-CEO Bret Taylor is leaving his job after just one year.
Additionally, Radke also mentioned that Salesforce is losing a key partner in Veeva, which is leaving Salesforce’s customer relationship management (CRM) platform for its own software beginning in 2025.
Making matters worse is the fact that Salesforce said today that Slack founder and CEO Stewart Butterfield is leaving the company in January. Salesforce purchased Slack for about $27 billion last year.
The timing of Butterfield’s departure, just days after Taylor announced he was leaving, is likely causing unease among Salesforce investors.
While Butterfield told CNBC that his leaving the company isn’t related to Taylor’s departure, investors are putting all of this latest news together and reacting very negatively.
And while key leadership changes can sometimes be a warning sign for a company, investors should remember to keep a long-term perspective on their Salesforce investment and revisit their original investing thesis to see if anything fundamental has changed.
Citigroup is an advertising partner of The Ascent, a Motley Fool company. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Salesforce and Veeva Systems. The Motley Fool has a disclosure policy.
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