Many S&P 500 shares have taken a giant hit in 2025. In accordance with my information supplier, round 130 shares within the index are at present buying and selling 25% or extra beneath their 52-week highs.

As a long-term investor, this market weak spot excites me and I’ve been making the most of it. Right here’s a have a look at an S&P 500 inventory I purchased earlier this week.

A brand new holding for me

The inventory I’ve snapped up is Salesforce (NYSE: CRM). It’s a software program firm that specialises in buyer relationship administration (CRM) options and has a world-class buyer base (round 90% of the Fortune 500 use its software program).

I’ve taken a small place to begin with, paying $268 per share. That’s roughly 27% beneath the inventory’s 52-week excessive of $369.

Investing sooner or later

Whereas Salesforce has had quite a lot of success with its CRM options up to now (it generates over $35bn in income yearly from them at the moment), it’s not the principle cause I’ve invested right here. What has lured me in is the corporate’s pivot in direction of AI brokers.

AI brokers are software program options designed to autonomously carry out enterprise duties that people at present do. They can be utilized throughout a spread of departments and industries, considerably enhancing effectivity for companies.

I reckon the marketplace for these brokers goes to blow up over the following decade. Salesforce CEO Marc Benioff reckons the ‘digital labour’ trade might be value up to $12trn.

Already, Salesforce is having success with its AI brokers (which it calls ‘Agentforce’). Final quarter (ended 31 January), it closed greater than 3,000 Agentforce offers.

Benioff says that the businesses utilizing them are experiencing “unprecedented levels of productivity, efficiency and cost savings.” So I imagine there’s an actual alternative for the corporate right here.

Our objective is to be the #1 supplier of digital labour on this planet.

Salesforce CEO Marc Benioff

Enticing valuation

Turning to the valuation, the inventory in all fairness priced, to my thoughts. At the moment, analysts count on Salesforce to generate earnings per share of $11.20 this monetary yr and $12.50 subsequent.

That offers us a price-to-earnings (P/E) ratio of 24, falling to 21 utilizing subsequent yr’s EPS forecast. That’s not excessive for a world-class software program firm with recurring revenues and loads of progress potential.

Loads of dangers

In fact, there are many dangers right here. Trying forward, the corporate is more likely to face competitors within the agentic AI area from the likes of Microsoft, ServiceNow, and different software program firms so there are not any ensures that it’s going to develop into a winner.

A worldwide financial slowdown is one other danger issue to think about. This might lead companies to place a pause on software program spending.

Tech shares might additionally proceed to be risky. Whereas the inventory is almost 30% off its highs, there’s an opportunity that it might maintain falling.

These dangers are why I’ve began with a small place within the inventory. Over time, I’ll look to construct up the place and develop my holding.