Acuity Brands vs Salesforce Which Is a Better Investment?

Acuity Brands and Salesforce are two companies that operate in completely different industries, yet both have seen significant growth in their stock prices in recent years. Acuity Brands, a lighting and building management company, has experienced steady growth due to increased demand for energy-efficient solutions. On the other hand, Salesforce, a cloud-based software company, has seen a surge in its stock price driven by the rise in digital transformation and remote work trends. Both companies continue to navigate the evolving market landscape with promising outlooks for the future.

Acuity Brands or Salesforce?

When comparing Acuity Brands and Salesforce, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Acuity Brands and Salesforce.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Acuity Brands has a dividend yield of 0.19%, while Salesforce has a dividend yield of 0.34%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Acuity Brands reports a 5-year dividend growth of 0.00% year and a payout ratio of 4.31%. On the other hand, Salesforce reports a 5-year dividend growth of 0.00% year and a payout ratio of 14.69%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Acuity Brands P/E ratio at 23.82 and Salesforce's P/E ratio at 42.75. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Acuity Brands P/B ratio is 4.23 while Salesforce's P/B ratio is 5.74.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Acuity Brands has seen a 5-year revenue growth of 0.38%, while Salesforce's is 1.16%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Acuity Brands's ROE at 19.11% and Salesforce's ROE at 13.35%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $318.38 for Acuity Brands and $347.43 for Salesforce. Over the past year, Acuity Brands's prices ranged from $188.63 to $337.99, with a yearly change of 79.18%. Salesforce's prices fluctuated between $212.00 and $369.00, with a yearly change of 74.06%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.