Shares of tech giant Salesforce Inc. CRM have had a bumpy start to 2025. After enjoying a multi-month rally that saw them gain more than 70% into December, they dipped into January and have struggled to find any real momentum since. As of Friday's close, they're down about 3% from where they started the year and almost 12% from December's all-time high. 

However, as we'll see below, there are many reasons to think that Salesforce shares are merely taking a breather, and in fact, it's not unreasonable to expect the stock to be back at an all-time high within the coming weeks. Let's jump in and take a closer look at the factors contributing to this bullish outlook.

Strong Fundamentals Despite a Recent Miss

For starters, there's the company's fundamental performance, which, aside from a rare miss in their last report, has been consistently solid. Despite a year-on-year revenue growth figure of more than 8%, Salesforce's EPS came to light against analyst expectations. Still, it was the company's highest-ever revenue print, and management saw fit to raise their forward guidance - always a bullish sign. This confident stance was driven by heightened demand for Salesforce's enterprise cloud solutions and the successful integration of artificial intelligence (AI) into its offerings. As CEO Marc Benioff remarked, "Agentforce, our complete AI system for enterprises built into the Salesforce Platform, is at the heart of a groundbreaking transformation."

It's never ideal to see a company miss analyst expectations, especially on a headline number like EPS, but in the grand scheme of things, it feels like more of a speed bump than a roadblock. Especially if Agentforce can realize even half of its potential in the coming quarters. 

Wall Street Remains Bullish

Building on the positive outlook from Salesforce's leadership are the many analysts who rate the stock a firm Buy. Just last week, the team over at Needham & Company reiterated their Buy rating on Salesforce shares, along with their $400 price target.

Last month, TD Cowen upgraded the stock from Hold to a Buy rating while also boosting its price target to $400.

This should be pretty convincing for those of us on the sidelines, considering Salesforce shares closed out last week around the $325 mark. This implies a potential upside in the realm of 25% and would quite easily have the stock back trading at an all-time high.

What Could Hold Salesforce Back?

While the outlook is predominantly positive across the board, it's worth pointing out that not everyone is on board with the rosy prospects. Last month, Guggenheim downgraded Salesforce to a Sell rating while assigning a price target of $247. This cautious stance reflected their concerns about the company's valuation, especially after last year's rally. 

Additionally, the competitive landscape in the AI and enterprise software sectors remains intense, with rivals continually innovating. These dynamics need to be closely watched to assess their potential impact on Salesforce's market share and ongoing profitability.

Why Now Could Be the Perfect Entry

Still, there's a lot more to like about Salesforce than dislike right now, with the stock's technical setup also bolstering the bull's case. Its Relative Strength Index (RSI) currently stands at 42, suggesting that the stock is slightly oversold and has a ton of room to run if it can get some momentum behind it.

Given the company's strong fundamental performance, bullish analyst endorsements, and strategic advancements in AI, this shouldn't be a problem. The broader equity market is currently near highs, investor sentiment remains firmly risk-on, and well-performing tech stocks like Salesforce are very much still in vogue. Don't be surprised if the bumpy sideways trading that has characterized its year-to-date turns into a solid base from which it launches the next phase of its rally.

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The article "Why Salesforce Stock Could Be on the Verge of a Breakout" first appeared on MarketBeat.