SAP Undervalued Amid AI Concerns, Analysts Say
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Should l Buy SAP?
Source: CNBC
- Market Overreaction: Despite the genuine threats posed by generative AI to traditional software companies, Bank of America analysts argue that SAP, as a global enterprise software leader, is undervalued due to market panic, with current share prices reflecting a pessimistic forecast of -3% revenue CAGR.
- Stable Growth Outlook: Analyst Frederic Boulan anticipates that SAP will achieve approximately 11% revenue CAGR and 15% EBIT CAGR from 2026 to 2030, indicating robust fundamentals and a low likelihood of significant growth shocks.
- Core AI Strategy: By making business AI central to its product strategy, SAP is expected to drive revenue growth and cost savings, further solidifying its competitive edge, especially against emerging competitors.
- Investment Opportunity Emerges: With SAP's stock price plummeting 30% over the past six months, analysts believe current levels present a buying opportunity, as Boulan's $308 price target implies a 56% upside, reflecting a significant undervaluation in the market.
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Analyst Views on SAP
Wall Street analysts forecast SAP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for SAP is 297.01 USD with a low forecast of 30.28 USD and a high forecast of 401.93 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 197.410
Low
30.28
Averages
297.01
High
401.93
Current: 197.410
Low
30.28
Averages
297.01
High
401.93
About SAP
SAP SE (SAP) is a Germany-based company. The Company provides business application software. It operates through three segments: Applications, Technology and Services, which engages in the sale of software licenses, subscriptions to its cloud-based applications and related services, primarily support services and various professional services, and support services, as well as implementation services for its software products and educational services on the use of its products; the SAP Business Network segment, which includes its cloud-based collaborative business networks and services related to the SAP Business Network, including cloud applications, professional services and educational services, as well as the Company markets and sells cloud offerings developed by SAP Ariba, SAP Fieldglass and Concur; and the Customer Experience segment, which comprises on-premise and cloud-based products that execute front office functions across the entire customer experience.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Stable Growth Outlook: Analyst Frederic Boulan anticipates that SAP will achieve approximately 11% revenue CAGR and 15% EBIT CAGR from 2026 to 2030, indicating robust fundamentals and a low likelihood of significant growth shocks.
- Core AI Strategy: By making business AI central to its product strategy, SAP is expected to drive revenue growth and cost savings, further solidifying its competitive edge, especially against emerging competitors.
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