Salesforce (CRN) had a tremendous 4Q18, yet the stock is down after 1Q19 guidance estimates came in slightly below Wall Street’s expectations; such is the fickle nature of the stock market, suggests Todd Shaver, editor of BullMarket.

Yet the dip presents a fabulous buying opportunity as the company has never been on surer footing, as proven by the otherwise resoundingly positive earnings call.

Revenue grew 25% — the same growth rate as 3Q18 — to $3.6 billion for the quarter. Consistently strong expansion is a fabulous achievement for a company that already boasts a $120 billion market cap. And the bigger story is even deeper in the numbers.

Although the core Sales Cloud still comprises 1/3 of total revenue, by far the fastest growing segment of the business is Platform Services, which grew 50% last year. This includes the recent acquisition of  MuleSoft, which helps businesses integrate and streamline third-party software into a truly unified “platform.”

Salesforce is using MuleSoft to generate awareness and interest in its new third-party app store – similar to Apple (AAPL), but specifically for Software as a service (SaaS) and thanks to that push platform revenue now comprises 1/5 of total revenue, the highest composition to-date. SaaS is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted.

The core business is still growing strong — Sales Cloud grew by 13% last year — and management remains focused on diversifying strongly across business lines while establishing a real foothold for future top-line growth. The number of new contracts valued at $20 million or more grew by 50% in the quarter and the two relationships on the books already worth over $100 million keep expanding.

CEO Marc Benioff predicted $20-$30 billion in revenue being “right around the corner” and raised full year 2019 guidance to $16 billion. (Last year the company booked $13.2 billion.) Operating cash flow grew 27% YoY last quarter to $1.3 billion, while EPS surged 50% YoY to $0.70.

Meanwhile, long-term debt held steady at $3 billion, where it has stood all year long. The company isn’t relying on debt to fuel its growth, so there’s zero concern of financial instability. Cash is strong at $4.3 billion.

Yet even with all of that, the stock slipped after Benioff announced on the earnings call that 1Q19 revenues are expected to grow 22% YoY. Wall Street had been expecting 23% YoY growth. And for that single percentage miss, the stock tumbled over 5%. What impresses us is that the full year guidance is still strong at the aforementioned $16 billion.

We couldn’t reiterate this more: the dip is an opportunity to exploit other investors’ lack of nerve. Major banks from Barclays to SunTrust to JP Morgan to Wells Fargo raised their price targets for the stock and reiterated their buy rating.

We couldn’t agree more. Salesforce is an industry pioneer that is expanding its customer base and diversifying its suite of products. What more could you ask for?

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