Salesforce.com (CRM) provides applications that manage customer information for sales, marketing and customer support. It has a customer base of approximately 85,000 clients. Its service provides sales leads, maintaining customer information and tracking customer interactions.

Intuit (INTU) caters to small businesses with its QuickBooks and TurboTax software. As well, it provides payroll and financial software for small businesses. The company has about 50 million users of its products.

Shares of customer relationship software giant Salesforce.com (CRM), which I first wrote about on June 18, 2009, at a price of $40.16, have pulled back this winter from a high near $151 to about $125, but I still like the shares at this juncture. Here's why.

Salesforce.com is a company whose products and services are hot. Revenue likely will rise 25% to 30% in FY2012, following a 27% surge in FY201.

Salesforce.com designs "on-demand" customer relationship software, software that lowers up-front investment, increases vendor accountability and enables flexible subscription pricing, among other benefits.

The past few years have been brutal for small businesses but it looks like things are starting to improve. A report from the National Federation of Independent Business shows that confidence is at a three-year high. There are even more plans to hire employees.

Well, top companies and investors are seeing opportunity. For example, Google (GOOG) Ventures, Salesforce.com (CRM) and Sequoia Capital have announced a $32 million round for HubSpot.

Analyst Upgrades

• SINA (SINA) to overweight from neutral at Piper Jaffray.
• Texas Instruments (TXN), ON Semiconductor (ONNN), Xilinx (XLNX) and Valassis (VCI) to overweight from neutral at JPMorgan.
• Salesforce.com (CRM) to buy from hold at Canaccord.
• Peet's Coffee (PEET) to buy from neutral at Janney Capital.
• Invesco Mortgage (IVR) to overweight from equal weight at Barclays.
• BTU International (BTUI) to buy from hold at Wunderlich.
• Coca-Cola Femsa (KOF) to overweight from neutral at HSBC.
• Chipotle (CMG) to market perform from underperform at Morgan Keegan.

It's extremely tough for a company to maintain a super growth rate for a couple years. After all, rivals will emerge and the market will get saturated.

But there are exceptions. Just look at Salesforce.com (CRM). It seems there is no end to the company's growth. Then again, it is a leader in cloud computing, which is expected be one of the biggest megatrends in tech history.

U.S. stock futures are higher Friday morning as crude oil prices stabilized. Futures for the Dow Jones Industrial Average gained 55 points to 12,092.00, while those for the S&P 500 index climbed 7 points to 1,309.70. Futures for the Nasdaq 100 index rose 15.50 points to 2,323.75.

U.S. stock market closed mixed yesterday, with the Dow Jones Industrial Average dropping 37.28 points, the Nasdaq Composite gaining 14.91 points and the S&P 500 declining 1.30 points.

We recently held a discussion with SAP (SAP) about the company's growth prospects, highlighting opportunities in on-premise, on-demand and enterprise mobile software markets (on-device). On-demand is a fast growth market, in which SAP competes with players like Salesforce.com (CRF), Oracle (ORCL) and Microsoft (MSFT).

We also discussed the prospects of in-memory technology and its potential advantages over traditional relational database technology, like competitor Oracle's Exadata machines.

Analyst Upgrades

• U.S. Steel (X) to buy from neutral and Barnes & Noble (BKS) to neutral from sell at Goldman.
• Salesforce.com (CRM) to buy from hold at Jefferies.
• Dollar Tree (DLTR) to overweight from equal weight at Barclays.
• Edison International (EIX) to hold from sell at Citigroup.
• Analog Devices (ADI) to overweight from neutral at JPMorgan.

Analyst upgrades:

• Verizon (VZ) to conviction buy from buy at Goldman.
• CSX (CSX) to outperform from market perform at Wells Fargo.
• AK Steel (AKS) to overweight from neutral, as well as Lorillard (LO) and Fifth Third Bancorp (FITB) to neutral from underweight, at JPMorgan.
• Marathon Oil (MRO) to overweight from equal weight at Morgan Stanley.
• Corning (GLW) to buy from outperform at CLSA.
• Quest Diagnostics (DGX) to buy from hold at Jefferies and to outperform from sector perform at RBC Capital.
• Salesforce.com (CRM) to buy from neutral at Roth Capital.
• Baker Hughes (BHI) to buy from hold at Weeden and to outperform from neutral at Macquarie.
• Western Digital (WDC) and Seagate (STX) to buy from underperform at BofA/Merrill.

If you didn't take some profits off the table in June or October with customer relationship software giant Salesforce.com (CRM), which I first wrote about on June 18, 2009 at a price of $40.16, it really makes sense to do so now.

Salesforce.com's stock continues rise almost as fast as a helium balloon: the stock has raced ahead this winter -- testing psychological resistance at $150, before pulling back slightly.

I'd also raise the sell/stop loss to $96 from $84 at this stage.

CRM's rise is being driven by strong demand for its products/services, with revenue likely to vault 25-30% in 2011, after a 21% surge in 2010.

The Tulip mania in Holland went on for seven years, supporting John Maynard Keynes commentary that "the market can remain irrational longer than you can remain solvent." This is one of my favorite stock market quotes, so forgive me if I repeat it too often. Although, I'm not sure that is possible when I watch Netflix, Inc. (NFLX) stock price continue to soar.

The stock was up almost 5% yesterday, on a down day, closing at $187.88, with a P/E of 70.90 -- that's 71 years times earnings folks!

Is that sensible? Investors are saying who cares? And the analysts are supporting them. The fact that analysts have a horrible track record and that the stock is highly speculative has become irrelevant.

While Salesforce.com (CRM) is the clear leader in cloud computing, the company still has serious competitive threats. In fact, the company is making some major changes -- with the goal of going to the next-level. Salesforce.com calls this "cloud 2.0."

A key to this strategy is acquisitions. Last year, Salesforce.com made six deals (they included Jigsaw, Sitemaster, Activa, Live Chat, Heroku and Etacts). And with a huge market cap and cash pile, Salesforce.com is certainly positioned nicely for more transactions in 2011.

Even before the phrase "cloud computing" became popular, Citrix Systems (CTXS) was a top player in the industry. Over the years, the company has developed sophisticated technologies to leverage the Internet to share applications and allow groups to collaborate.

After being stuck in a trading range for some time, this year the stock of Citrix got juiced up. A big help has certainly been the surge from the leader in cloud-computing, Salesforce.com (CRM).

With a market cap of nearly $20 billion and a price-to-earnings ratio at a nose bleed level of 267, it certainly makes a lot of sense for Salesforce.com (CRM) to get aggressive with acquisitions. The company is sitting on a growing pile of cash and it needs to maintain its competitive edge – which gets increasingly difficult.

So this week, Saleforce.com agreed to purchase Heroku for $212 million. Haven't heard of them? Well, in the programming community, it is a popular company. It is a cloud-computing provider for Ruby, which allows for the creation of web applications. This is done by creating a platform-as-a-service infrastructure.

Salesforce.com (CRM) is certainly enjoying a positive post-earnings reaction Friday. After unveiling its third-quarter results last night, the stock sailed to a new all-time high as a slew of brokerage firms rushed to raise their price targets on CRM.

Specifically, CRM swung to a third-quarter profit of $21.1 million, or 15 cents per share, while revenue increased 30% to $429.1 million. Excluding items, CRM earned 32 cents per share. By contrast, analysts were looking for a quarterly profit of just 31 cents per share on revenue of $410.5 million.