Salesforce's (CRM) fiscal Q4 results are expected to be mostly in line with expectations, with investors focused on signs of organic demand inflection, Morgan Stanley said in a note Monday.

The investment bank said Salesforce is heading into its fiscal Q4 earnings report with its stock down about 30% year to date, significantly underperforming the broader large-cap software group, which is down about 15% on average. The company is set to report fiscal Q4 results on Wednesday.

Investor concerns are mainly tied to broader Software as a Service, or SaaS-related risks, including fears that enterprises may shift toward building software internally, startups could erode the competitive advantages of legacy vendors, and seat-based pricing models may come under pressure, Morgan Stanley said.

Salesforce should be able to guide to about 9% to 9.5% organic subscription revenue growth in fiscal 2027 on a constant currency basis, Morgan Stanley said, adding that although that would not represent a major growth inflection, it would set the stage for a relatively stronger growth year in fiscal 2027.

"Net, while an inline fiscal Q4 is unlikely to reset sentiment on its own, further evidence of an organic demand inflection could build confidence in an improved FY27 growth profile," according to the note.

Morgan Stanley adjusted its price target on Salesforce to $287 from $398, and kept its overweight rating.

Salesforce shares were down 4.9% in recent trading Monday.

Price: 176.06, Change: -9.10, Percent Change: -4.91