Bank of America Securities analyst Frederic Boulan reiterated a Buy rating on SAP SE (0NW4 – Research Report) today and set a price target of €307.00.
Frederic Boulan has given his Buy rating due to a combination of factors including SAP’s strong positioning in the cloud and AI sectors, which are expected to drive significant revenue growth. The company is in the early stages of cloud migration, with only a third of its ERP customers having transitioned, and an annual migration rate of about 8% projected over the next six years. This migration is anticipated to support a robust cloud revenue compound annual growth rate (CAGR) of 21.5% through 2028.
Moreover, SAP’s introduction of the Business Data Cloud (BDC) showcases its ambitions in the generative AI space, allowing customers to integrate and analyze data from various sources. This positions SAP to leverage customer data effectively, enhancing business insights and supporting incremental growth. Despite the recent share price increase, Boulan believes that SAP’s valuation remains competitive compared to global peers, with expected earnings growth and stable multiples contributing to potential share price appreciation.
According to TipRanks, Boulan is a 4-star analyst with an average return of 15.9% and a 63.33% success rate.
In another report released yesterday, UBS also maintained a Buy rating on the stock with a €283.00 price target.