SAP SE (SAP) AI Stock Analysis

• Market Cap: €281.45B
• Dividend Yield: 0.92%
• Average Volume (3M): 2.30M
• Price to Earnings (P/E): 49.1
• Beta (1Y): 0.91
• Revenue Growth: 10.51%
• EPS Growth: 203.37%
• Country: DE
• Employees: 109,973
• Sector: Technology
• Sector Strength: 45
• Industry: Software
• EPS (TTM): 4.91
• Shares Outstanding: 1,228,504,300
• 10 Day Avg. Volume: 1,838,837
• 30 Day Avg. Volume: 2,301,887
• PEG Ratio: 0.24
• Price to Book (P/B): N/A
• Price to Sales (P/S): 7.16
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €290.67
• Price Target Upside: 18.79% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 20

SAP SE demonstrates strong financial performance with robust revenue growth and a solid balance sheet, although there are concerns regarding declining free cash flow. Technical analysis suggests some short-term weakness, while long-term support remains intact. The high P/E ratio indicates potential overvaluation, which, combined with a moderate dividend yield, tempers the overall attractiveness of the stock.

Positive Factors

Cloud Revenue Growth

Revenue increased 11% y/y to €9,377mn driven by a 27% y/y increase in cloud.

Financial Performance

Free cash flow of €3.6bn was well ahead of expectations.

Strategic Partnerships

With the launch of Business Data Cloud (BDC), SAP aims to be a core provider of AI agents, enabling customers to extract insights from both SAP and third-party data via a partnership with Databricks.

Negative Factors

Competitive Pressure

Intensified competition could create downward pressure on product pricing and margins.

Legacy Licensing Transition

The rapid decline and transition away from legacy licensing towards more predictable recurring cloud revenue should present challenges as SAP navigates a potentially tougher macro environment.

SAP SE Business Overview & Revenue Model

Company Description

SAP SE (Systems, Applications, and Products in Data Processing) is a German multinational software corporation that specializes in enterprise software to manage business operations and customer relations. Founded in 1972, SAP is one of the world's leading producers of software for the management of business processes, developing solutions that facilitate effective data processing and information flow across organizations. The company's primary products include enterprise resource planning (ERP) software, customer relationship management (CRM) software, supply chain management (SCM) solutions, and various industry-specific software applications. SAP serves a wide range of industries, including manufacturing, financial services, consumer goods, and healthcare.

How the Company Makes Money

SAP SE generates revenue primarily through the sale of software licenses, subscriptions, and related services. The company's revenue model is based on a combination of on-premise software licenses and cloud-based subscriptions. SAP's key revenue streams include software licenses and support, cloud subscriptions and services, and professional services. Software licenses and support involve upfront fees for software licenses and recurring revenue from maintenance and support contracts. Cloud subscriptions and services provide a steady stream of recurring revenue from customers who use SAP's cloud offerings, such as SAP S/4HANA Cloud and SAP Business Technology Platform. Professional services include consulting, training, and implementation services that help customers optimize their use of SAP solutions. Additionally, SAP has strategic partnerships with major technology companies and system integrators that enhance its product offerings and broaden its market reach, contributing to its revenue growth.

SAP SE Financial Statement Overview

Summary

Income Statement

Balance Sheet

Cash Flow

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
29.42B	34.18B	31.21B	30.87B	27.84B	27.34B
	Gross Profit
21.00B	25.01B	22.60B	21.94B	19.89B	19.45B
	EBIT
4.74B	8.25B	5.79B	4.67B	2.88B	6.62B
	EBITDA
6.42B	7.08B	7.50B	6.48B	8.92B	8.26B
	Net Income Common Stockholders
3.93B	3.12B	6.14B	2.28B	5.26B	5.14B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
13.61B	11.24B	11.28B	9.86B	11.66B	6.95B
	Total Assets
72.92B	74.12B	68.33B	72.16B	71.17B	58.48B
	Total Debt
9.60B	11.45B	8.79B	14.37B	15.15B	15.95B
	Net Debt
304.00M	1.84B	666.00M	5.37B	6.25B	10.64B
	Total Liabilities
29.58B	28.31B	24.93B	29.31B	29.65B	28.55B
	Stockholders Equity
43.08B	45.44B	43.16B	40.13B	38.85B	29.71B
Cash Flow		Free Cash Flow
4.29B	4.42B	5.55B	4.77B	5.42B	6.38B
	Operating Cash Flow
5.20B	5.22B	6.33B	5.65B	6.22B	7.19B
	Investing Cash Flow
-3.05B	-667.00M	906.00M	667.00M	-3.06B	-2.99B
	Financing Cash Flow
-3.11B	-3.40B	-7.73B	-6.34B	-56.00M	-4.00B

SAP SE Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 244.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:SAP, the sentiment is Neutral. The current price of 244.7 is above the 20-day moving average (MA) of 234.77, below the 50-day MA of 250.83, and above the 200-day MA of 226.78, indicating a neutral trend. The MACD of -4.85 indicates Negative momentum. The RSI at 51.96 is Neutral, neither overbought nor oversold. The STOCH value of 68.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DE:SAP.

SAP SE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GFT	77 Outperform	€594.97M	12.80	18.15%	2.24%	8.63%	-3.90%
BC8	74 Outperform	€4.60B	18.72	13.44%	1.93%	-1.82%	-7.54%
SAP	66 Neutral	€281.45B	49.13	7.05%	0.92%	10.51%	203.37%
ADS	61 Neutral	€38.50B	50.39	15.04%	0.33%	10.53%	―
Sector *	59 Neutral	$10.59B	10.09	-6.37%	3.05%	7.44%	-10.67%