Chandramouli Sriraman, an analyst from Stifel Nicolaus, maintained the Buy rating on SAP SE (0NW4 – Research Report). The associated price target remains the same with €300.00.
Chandramouli Sriraman has given his Buy rating due to a combination of factors that highlight SAP SE’s promising growth trajectory. The analyst points to the expected acceleration in revenue growth through FY27, driven by robust cloud revenue momentum and a stable maintenance business. This is supported by the continued success of SAP’s Cloud ERP Suite, which has been growing at a faster pace than the overall cloud segment.
Sriraman also emphasizes the potential for significant additional cloud revenue from the migration of SAP’s extensive base of legacy ERP maintenance customers to the RISE with SAP platform. This migration is expected to occur at a conversion factor of 2-3 times, potentially adding over €25 billion in cloud revenue over the long term. Furthermore, the anticipated expansion in cloud gross margins is likely to sustain margin growth, contributing to an impressive projected EPS growth of 25% CAGR from 2024 to 2027. These factors collectively reinforce the Buy rating and the €300 price target for SAP SE.
In another report released on February 19, Redburn Atlantic also initiated coverage with a Buy rating on the stock with a €320.00 price target.