These days, we’re all living in the cloud, with tech companies large and small scrambling for share in the rapidly expanding market for Internet-based services, notes Richard Moroney, editor of Dow Theory Forecasts.

Still at the center of that maelstrom of growth is one of the companies that started it all — Salesforce (CRM). Back in 1999, Salesforce pioneered the concept of delivering software as a service, making applications and customer data available via the Internet rather than tethering them to an individual computer.

Over the next two decades, using remote servers to host software and infrastructure became increasingly popular, yet the market still has room for growth.

Salesforce’s broad business mix and steady stream of new products — including advances in generative artificial intelligence — plant the company in the middle of the secular cloud uptrend. In recent quarters, Salesforce has invested in products designed for mobile and social-networking environments.

Salesforce has reached a stock market value of more than $219 billion but still grows like a small-cap. In the 12 months ended April, the company posted growth of 15% in sales, 30% in per-share profits, and 23% in operating cash flow. Consider recent growth a continuation of the theme, as Salesforce has delivered annualized growth of 24% for sales, 27% for profits, and 22% for operating cash flow over the last five years.

Expect more of the same in coming years. Analysts target sales growth of 10% to 11% in each of the next three fiscal years ending January, supporting profit growth of 42% in fiscal 2024 and at least 18% in the following two years.

Salesforce’s premium growth doesn’t fetch an outrageous price. At 30 times expected current-year earnings, the stock trades slightly below the application-software median, while its price/earnings-to-growth rate of 1.2 represents a 42% discount.

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