SAP SE (US) (SAP)
NYSE:SAP
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SAP AG
(NYSE:SAP)
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Rating:72Outperform
Price Target:
$190.00
▲(4.84% Upside)
Action:Reiterated
Date:05/04/26
Score is driven mainly by strong financial performance (high margins, conservative balance sheet, solid cash generation) and a supportive earnings update with maintained guidance and robust cloud momentum. The key constraint is weak-to-neutral technicals (price below major moving averages and negative MACD), with valuation only moderately attractive at a ~22x P/E and a modest dividend yield.
Positive Factors
Multi‑year cloud backlog
A €77bn total cloud backlog (€21bn current, ~4yr duration) provides multi‑year contracted revenue visibility, smoothing near‑term volatility and underpinning recurring revenue. This durable backlog supports planning, capital allocation and cross‑sell as cloud adoption expands.
Negative Factors
Decline in software license revenue
A 27% drop in software license sales reflects the structural shift from perpetual licenses to subscriptions. While cloud growth offsets much of this, the transition compresses upfront cash and can reduce near‑term recognized revenue and margins from legacy lines until subscription monetization fully replaces license economics.
Read all positive and negative factors
Positive Factors
Negative Factors
Multi‑year cloud backlog
A €77bn total cloud backlog (€21bn current, ~4yr duration) provides multi‑year contracted revenue visibility, smoothing near‑term volatility and underpinning recurring revenue. This durable backlog supports planning, capital allocation and cross‑sell as cloud adoption expands.
Read all positive factors
SAP AG Key Performance Indicators (KPIs)
Any
Cloud Backlog
Reflects the total value of future cloud service contracts, providing insight into anticipated revenue streams and the strength of customer demand for SAP's cloud offerings.
Reflects the total value of future cloud service contracts, providing insight into anticipated revenue streams and the strength of customer demand for SAP's cloud offerings.
Data provided by:
The Fly
The FlySAP AG (SAP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$205.72B
Dividend Yield1.07%
Average Volume (3M)3.95M
Price to Earnings (P/E)22.3
Beta (1Y)0.99
Revenue Growth14.77%
EPS Growth41.36%
CountryUS
Employees108,187
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)6.41
Shares Outstanding1,228,504,300
10 Day Avg. Volume3,612,789
30 Day Avg. Volume3,945,761
Financial Highlights & Ratios
PEG Ratio0.27
Price to Book (P/B)5.39
Price to Sales (P/S)6.55
P/FCF Ratio30.37
Enterprise Value/Market Cap0.81
Enterprise Value/Revenue4.49
Enterprise Value/Gross Profit6.16
Enterprise Value/Ebitda13.59
Forecast
1Y Price Target
$252.25Price Target Upside39.20% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)8.45
Revenue Forecast (FY)$47.02B
SAP AG Business Overview & Revenue Model
Company Description
SAP SE, together with its subsidiaries, provides applications, technology, and services worldwide. It offers SAP S/4HANA that provides software capabilities for finance, risk and project management, procurement, manufacturing, supply chain and ass...
How the Company Makes Money
SAP primarily makes money by licensing and delivering enterprise software and related services, with revenue generated through several main streams: (1) Cloud subscriptions and support: recurring subscription fees for SAP cloud applications and pl...
SAP AG Earnings Call Summary
Earnings Call Date:Apr 23, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Positive
The call presented multiple strong operational and financial achievements: double-digit total revenue growth (+12% to EUR 9.6B), robust cloud momentum (+27% cloud revenue, +25% cloud backlog), material profitability gains (non-IFRS operating profit +24%, 30% operating margin), strong customer wins and demonstrable AI-driven customer and internal productivity gains. These positives are tempered by macro and geopolitical uncertainty (Middle East conflict, potential Strait of Hormuz disruption), a planned modest deceleration in cloud growth, a sharp decline in software licenses (-33%), and near-term services revenue pressure. Management reiterated full-year guidance but noted it is contingent on a near-term stabilization and on contributions from the Reltio acquisition. Overall, the operational and financial strengths outweigh the risks discussed, though meaningful uncertainty remains.Positive Updates
Strong Cloud Backlog Growth
Current cloud backlog increased 25% year-on-year to EUR 21.9 billion, providing healthy forward visibility for cloud revenue.
Negative Updates
Geopolitical Risk and Uncertainty
Ongoing conflict in the Middle East (including potential Strait of Hormuz disruption) has created higher uncertainty; management warns a prolonged or escalated disruption could materially derail supply chains, customer investment behavior and the company's ability to meet outlook.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Cloud Backlog Growth
Current cloud backlog increased 25% year-on-year to EUR 21.9 billion, providing healthy forward visibility for cloud revenue.
Read all positive updates
Company Guidance
SAP maintained its full‑year 2026 outlook, noting key assumptions (near‑term de‑escalation in the Middle East, reopening of the Strait of Hormuz, cost mitigation and the expected contribution from the Reltio acquisition) while warning the conflict could materially derail results; Q1 metrics underpinning the guidance included current cloud backlog up 25% to EUR 21.9bn, cloud revenue up 27% (nearly €6bn), cloud ERP Suite revenue +30% (87% of cloud revenue growth), total revenue €9.6bn (+12%), software licenses −33%, non‑IFRS operating profit €2.9bn (+24%) and IFRS operating profit €2.7bn (+17%), an operating margin of 30% (+2.9 pp), IFRS/non‑IFRS cloud gross margins ~74.6%/75.2%, free cash flow €3.2bn (including a €408m payout), IFRS EPS €1.66 (+9%) and non‑IFRS EPS €1.72 (+20%), effective tax rates ~29.1/29.3%, and the company reiterated that less than 40% of 2025 cloud revenue was tied to named users; SAP expects a slight deceleration in current cloud backlog and cloud revenue growth into Q2, a wide range of outcomes given macro uncertainty (with the second half typically accounting for the lion’s share of bookings), plans to keep total expenses growing at roughly 80–90% of revenue growth, and targets around EUR 2bn run‑rate efficiencies by end‑2028.SAP AG Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
88
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 37.34B | 36.80B | 34.18B | 31.21B | 29.52B | 26.95B |
| Gross Profit | 27.18B | 26.81B | 24.93B | 22.53B | 21.48B | 19.73B |
| EBITDA | 12.33B | 12.07B | 7.08B | 8.03B | 8.28B | 10.99B |
| Net Income | 7.31B | 7.16B | 3.12B | 6.14B | 2.28B | 5.26B |
Balance Sheet | ||||||
| Total Assets | 73.46B | 70.33B | 74.12B | 68.33B | 72.16B | 71.17B |
| Cash, Cash Equivalents and Short-Term Investments | 10.04B | 9.77B | 11.24B | 11.28B | 9.86B | 11.66B |
| Total Debt | 0.00 | 8.07B | 10.65B | 8.79B | 13.09B | 15.15B |
| Total Liabilities | 28.10B | 25.11B | 28.31B | 24.93B | 29.31B | 29.65B |
| Stockholders Equity | 44.86B | 44.73B | 45.44B | 43.16B | 40.13B | 38.85B |
Cash Flow | ||||||
| Free Cash Flow | 8.06B | 7.94B | 4.42B | 5.55B | 4.77B | 5.52B |
| Operating Cash Flow | 8.86B | 8.65B | 5.22B | 6.33B | 5.65B | 6.22B |
| Investing Cash Flow | -283.02M | -1.33B | -667.00M | 906.00M | 667.00M | -3.06B |
| Financing Cash Flow | -9.93B | -7.85B | -3.40B | -7.73B | -6.34B | -56.00M |
SAP AG Technical Analysis
Positive
181.22
Price Trends
171.69
Positive
192.23
Negative
224.95
Negative
Market Momentum
0.84
Negative
54.18
Neutral
70.19
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SAP, the sentiment is Positive. The current price of 181.22 is above the 20-day moving average (MA) of 171.36, above the 50-day MA of 171.69, and below the 200-day MA of 224.95, indicating a neutral trend. The MACD of 0.84 indicates Negative momentum. The RSI at 54.18 is Neutral, neither overbought nor oversold. The STOCH value of 70.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SAP.
SAP AG Risk Analysis
SAP AG disclosed 13 risk factors in its most recent earnings report. SAP AG reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SAP AG Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $105.33B | 57.69 | 14.98% | ― | 21.72% | 13.59% | |
74 Outperform | $87.52B | 8.75 | 23.29% | 0.64% | 15.07% | 33.69% | |
72 Outperform | $205.72B | 22.29 | 17.25% | 1.07% | 14.77% | 41.36% | |
71 Outperform | $147.31B | 25.54 | 12.37% | 0.63% | 9.58% | 21.99% | |
67 Neutral | $32.13B | 35.00 | 10.41% | ― | 13.70% | 76.27% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $59.69B | -48.84 | -60.27% | ― | 29.16% | -2.26% |
* Technology Sector Average
SAP
SAP AG
175.95
-115.26
-39.58%
INTU
Intuit
319.94
-394.38
-55.21%
CRM
Salesforce
180.07
-91.04
-33.58%
WDAY
Workday
128.14
-109.87
-46.16%
NOW
ServiceNow
102.13
-103.35
-50.30%
SNOW
Snowflake
172.20
-27.85
-13.92%
SAP AG Corporate Events
SAP SE Posts Strong Q1 2026 Cloud Growth and Confirms Full-Year Outlook
Apr 28, 2026
SAP SE, based in Walldorf, Germany, is a global enterprise software provider specializing in cloud-based ERP suites, business applications and related services for corporate and public-sector customers. The company has been accelerating its shift ...
SAP SE Sets Virtual 2026 AGM, Proposes €2.50 Dividend and New Capital Measures
Apr 21, 2026
SAP SE has convened its 2026 Annual General Meeting of Shareholders for May 5, 2026, to be held as a virtual-only event in accordance with German stock corporation law, with shareholders participating remotely rather than in person. The agenda cov...
SAP SE Issues 2025 Integrated Report Highlighting Strong Cloud Growth and AI-Led Transformation
Mar 6, 2026
SAP SE has published its Integrated Report 2025, combining financial statements and detailed environmental, social and governance disclosures for fiscal year 2025, which covers SAP SE and its controlled subsidiaries and was released on February 26...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.