Strong 2027 Guidance and Generative AI Drive Salesforce’s (CRM) Revenue Reacceleration

Diamond Hill Capital, a First Eagle Investment Management company, issued its Q3 2026 investor letter for its "Large Cap Strategy". The letter can be downloaded here. The Strategy returned 3.18% (net of fees) in the quarter, outperforming the 2.61% return of the Russell 1000 Value Index. Key positive contributors included stock selection in information technology, an underweight in utilities, and an overweight in energy, while detractors were found in industrials, health care, and consumer staples. Looking ahead, the firm anticipates below-average returns due to high equity market valuations, although attractive bottom-up investment opportunities remain. Notably, software and legacy technology stocks outperformed in Q3 2026, despite recent index exclusions; some AI-related stocks that had boosted the index previously underperformed. Additionally, reviewing the Strategy's top five holdings provides insight into its best positions for 2026.

In its Q3 2026 investor letter, Diamond Hill Capital Large Cap Strategy highlighted Salesforce, Inc. (NYSE:CRM) as a top contributor for the quarter. Salesforce, Inc. (NYSE:CRM) is a cloud computing company that offers Customer Relationship Management (CRM) technology that brings companies and customers together. On October 15, 2026, Salesforce, Inc. (NYSE:CRM) closed at $246.74 per share. Over the past month, Salesforce, Inc. returned 0.83%, and its shares are down 1.31% over the past year. Salesforce, Inc. (NYSE:CRM) has a market capitalization of $203.07 billion with a 52-week trading range between $146.32 and $ 269.11.

Diamond Hill Capital Large Cap Strategy stated the following regarding Salesforce, Inc. (NYSE:CRM) in its Q3 2026 investor letter:

"Customer relationship management software provider Salesforce, Inc. (NYSE:CRM) outperformed on strong 2027 guidance, creating a solid set-up for reaccelerating revenue growth. Additionally, revenue for the company's generative AI offering is growing, and the company's headless initiatives stand to further accelerate revenue growth."

Salesforce, Inc. (NYSE:CRM) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 99 hedge fund portfolios held Salesforce, Inc. (NYSE:CRM) at the end of the second quarter, which was 101 in the previous quarter. While we acknowledge the potential of Salesforce, Inc. (NYSE:CRM) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we discussed Salesforce, Inc. (NYSE:CRM) and shared Oakmark Fund's views on the company. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.

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This article is originally published at Insider Monkey.