In a report released yesterday, Derrick Wood from TD Cowen maintained a Buy rating on SAP AG, with a price target of $250.00.
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Derrick Wood has given his Buy rating due to a combination of factors including SAP’s strong cloud performance and resilient profitability despite geopolitical headwinds. First-quarter cloud revenue expanded at a robust pace and margins exceeded expectations, helped by revenue outperformance and lower share-based compensation, underscoring solid operational leverage.
At the same time, management reaffirmed its multi-year cloud growth outlook, with the Reltio acquisition expected to offset Middle East–related softness and contribute incremental growth in FY26. While acknowledging that deal delays from the regional conflict could pressure near-term bookings, Wood views the risk as manageable and notes that SAP’s AI monetization strategy and upcoming product announcements should support sustained demand and valuation, justifying the Buy recommendation.
SAP’s price has also changed dramatically for the past six months – from $278.530 to $163.250, which is a -41.39% drop .