Analyst Keith Bachman from BMO Capital maintained a Buy rating on SAP AG (SAP – Research Report) and increased the price target to $320.00 from $300.00.
Keith Bachman has given his Buy rating due to a combination of factors including SAP’s strong performance in the March quarter, which exceeded expectations and set a positive tone for the software earnings season. SAP’s results and guidance are anticipated to surpass those of many other companies in the sector, supported by an enhanced solution portfolio and ongoing transitions to the cloud.
Bachman also highlights the potential upside in SAP’s free cash flow guidance for CY25, assuming stable macroeconomic conditions. Despite the possibility of economic downturns, SAP is expected to perform better than many peers due to its cloud conversion strategy and effective cost management. Additionally, the impressive growth in SAP’s Current Cloud Backlog, a key investor metric, further supports the positive outlook, with significant contributions from AI-related deals.
In another report released yesterday, TD Cowen also maintained a Buy rating on the stock with a $320.00 price target.