Salesforce (CRM  ) shares jumped more than 5% following the company reporting Q1 earnings that topped expectations across the board. The report also marked a return to acceleration for the cloud pioneer. Another contributing factor was the company issuing guidance above forecasts as well.

Inside the Numbers

In Q1, Salesforce reported $1.21 in earnings per share which topped expectations of $0.88 per share. Revenue also came in higher at $6 billion vs expectations of $5.9 billion. This is a 23% increase from last year's Q1 and notably marked an acceleration from that quarter's 20% growth rate.

CEO Mark Benioff also announced that its Dreamforce conference will be held in person in San Francisco, New York, Paris, and London with the requirement that all attendees will be vaccinated. Dreamforce is an annual gathering of Salesforce developers, managers, and users where new product updates are announced.

Salesforce's biggest segment is its core Sales Cloud product that helps companies' sales departments track prospects. In Q1, it generated $1.4 billion in revenue, an 11% increase from last year. Platform and Other segments which include MuleSoft and Tableau contributed $1.8 billion in revenue and were up 28% from last year.

In Q2, Salesforce sees between $0.91 and $0.92 in EPS and $6.22 billion in revenue. Both are above consensus expectations of $0.86 per share in earnings and $6.1 billion in revenue. For the full year, it sees $26 billion in revenue and $3.80 in earnings per share. Both are meaningfully above expectations. It also sees operating margins increasing to 18% from 17.7%.

The company expects to close its acquisition of Slack for $27.7 billion in Q2 and expects that it will contribute $500 million in revenue for the full year.

Stock Price Outlook

Salesforce's stock has done very little since peaking in August. However, the company has consistently delivered growth above 20% in its last three earnings reports. Further, while many tech stocks saw an increase in adoption during the pandemic, Salesforce is more reliant on in-person sales for its enterprise software, so it could see further acceleration as the economy reopens.

Salesforce's shares are increasingly becoming attractive on a valuation basis. It's certainly more expensive than the broader market, but it's growing faster with wider margins. However, the valuation isn't enticing enough for it to be a beneficiary of the rotation from growth to value.

Therefore, investors should remain patient as a better buying opportunity likely awaits.