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How Long Will Salesforce's Free Ride Last?
Eventually, shareholders will stop shrugging off its pricey purchases.
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Salesforce.com almost never turns a profit, and pays rich prices for acquisitions. Investors love it, but can the romance last?
Shareholders of the cloud-software company were largely unruffled Wednesday as Salesforce announced its latest pricey purchase, the $2.8 billion takeover of Demandware. Salesforce is paying about 11 times Demandware's revenue in the past year -- more than double the median multiple offered in similar transactions over the last decade. That makes the acquisition more expensive than fondly remembered takeovers like Hewlett-Packard's writedown-riddled purchase of Autonomy.