SAP upgraded to Buy from Hold at HSBC

HSBC analyst Abhishek Shukla upgraded SAP (SAP) to Buy from Hold with a price target of EUR 182, down from EUR 187. The stock’s de-rating has been driven by concerns that AI could replace software, the analyst tells investors in a research note. HSBC views the concerns as unwarranted for large software companies, saying vibe coding using AI tools works fine for small projects but does not scale well. In addition, SAP is an operating system of businesses with integration with third party tools and in-house customizations by customers, making it difficult for challengers, the analyst tells investors in a research note.