SAP (SAP) Downgraded to Hold at Zacks Investment Research

SAP (NYSE:SAP) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued on Wednesday.

According to Zacks, “SAP’s long-term growth drivers include resiliency of its Cloud and Software business, presence of a large business network and dominance over critical client demand areas, namely customer engagement and human capital management. SAP’s Customer Engagement and Commerce solutions once again achieved double-digit growth in new cloud bookings as well as software revenue. Of late, growth of the company’s S/4HANA and other Cloud initiatives has been spectacular, which, in turn, has been boosting financials. However, on the flip side, the company’s shares have underperformed the industry average year to date. Intensifying competition in the IT services industry and currency fluctuations are affecting profits. Prolonged softness in certain end markets and inherent seasonality in clients’ technology spending exposes the company’s sales to risks of quarterly fluctuations.”

A number of other equities analysts have also commented on the stock. Argus raised their target price on shares of SAP from $118.00 to $130.00 and gave the stock a “buy” rating in a research report on Monday, October 23rd. Oppenheimer reaffirmed a “buy” rating and set a $120.00 target price on shares of SAP in a research report on Tuesday, November 14th. BMO Capital Markets started coverage on shares of SAP in a research report on Friday, October 20th. They set a “market perform” rating and a $115.00 target price on the stock. They noted that the move was a valuation call. Stifel Nicolaus reaffirmed a “sell” rating and set a $75.00 target price on shares of SAP in a research report on Thursday, October 12th. Finally, Berenberg Bank started coverage on shares of SAP in a research report on Wednesday, August 23rd. They set a “buy” rating on the stock. One equities research analyst has rated the stock with a sell rating, five have assigned a hold rating and fourteen have assigned a buy rating to the company’s stock. The stock has a consensus rating of “Buy” and an average target price of $106.73.

Shares of SAP (SAP) traded down $0.72 during midday trading on Wednesday, reaching $115.20. 426,900 shares of the company’s stock traded hands, compared to its average volume of 696,319. The company has a current ratio of 1.18, a quick ratio of 1.18 and a debt-to-equity ratio of 0.24. The company has a market capitalization of $137,540.00, a P/E ratio of 32.29, a P/E/G ratio of 3.35 and a beta of 1.13. SAP has a twelve month low of $85.42 and a twelve month high of $116.90.

SAP (NYSE:SAP) last announced its quarterly earnings data on Thursday, October 19th. The software maker reported $1.01 earnings per share (EPS) for the quarter, topping the Thomson Reuters’ consensus estimate of $0.89 by $0.12. The business had revenue of $5.59 billion during the quarter, compared to the consensus estimate of $5.68 billion. SAP had a net margin of 15.80% and a return on equity of 15.43%. The business’s revenue was up 4.0% on a year-over-year basis. research analysts predict that SAP will post 4.13 earnings per share for the current fiscal year.

A number of hedge funds have recently modified their holdings of SAP. Harding Loevner LP increased its holdings in SAP by 4,590.3% during the third quarter. Harding Loevner LP now owns 267,928,144 shares of the software maker’s stock valued at $402,798,000 after buying an additional 262,215,799 shares during the period. FMR LLC increased its holdings in SAP by 6,475.0% during the second quarter. FMR LLC now owns 396,409 shares of the software maker’s stock valued at $41,493,000 after buying an additional 390,380 shares during the period. Canada Pension Plan Investment Board purchased a new position in SAP during the third quarter valued at approximately $33,601,000. Sustainable Growth Advisers LP increased its holdings in SAP by 8.9% during the second quarter. Sustainable Growth Advisers LP now owns 2,567,035 shares of the software maker’s stock valued at $268,691,000 after buying an additional 210,664 shares during the period. Finally, Fisher Asset Management LLC increased its holdings in SAP by 2.1% during the third quarter. Fisher Asset Management LLC now owns 6,599,155 shares of the software maker’s stock valued at $723,597,000 after buying an additional 136,874 shares during the period. 3.66% of the stock is currently owned by institutional investors.

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About SAP

SAP SE (SAP) is a software and service provider. The Company offers enterprise application software. The Company operates through two segments: Applications, Technology & Services segment, and the SAP Business Network segment. The Applications, Technology & Services segment is engaged in the sale of software licenses, subscriptions to its cloud applications, and related services (primarily support services and various professional services, and support services, as well as implementation services of its software products and education services on the use of its products).

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