SAP SE (SAP.DE) Stock Fundamental Analysis
FRA:SAP - Deutsche Boerse Ag - DE0007164600 - Common Stock - Currency: EUR
SAP gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 103 industry peers in the Software industry. While SAP has a great profitability rating, there are some minor concerns on its financial health. SAP has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year SAP was profitable.
In the past year SAP had a positive cash flow from operations.
SAP had positive earnings in each of the past 5 years.
SAP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
SAP has a Return On Assets of 9.56%. This is amongst the best in the industry. SAP outperforms 86.41% of its industry peers.
With a decent Return On Equity value of 15.95%, SAP is doing good in the industry, outperforming 72.82% of the companies in the same industry.
With an excellent Return On Invested Capital value of 13.00%, SAP belongs to the best of the industry, outperforming 84.47% of the companies in the same industry.
SAP had an Average Return On Invested Capital over the past 3 years of 8.58%. This is below the industry average of 11.25%.
The last Return On Invested Capital (13.00%) for SAP is above the 3 year average (8.58%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.56% | ||
| ROE | 15.95% | ||
| ROIC | 13% |
ROA(3y)5.45%
ROA(5y)6.51%
ROE(3y)8.93%
ROE(5y)11.53%
ROIC(3y)8.58%
ROIC(5y)8.51%
1.3 Margins
SAP has a Profit Margin of 18.23%. This is in the better half of the industry: SAP outperforms 77.67% of its industry peers.
SAP's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 27.04%, SAP belongs to the top of the industry, outperforming 86.41% of the companies in the same industry.
SAP's Operating Margin has been stable in the last couple of years.
The Gross Margin of SAP (73.80%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of SAP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.04% | ||
| PM (TTM) | 18.23% | ||
| GM | 73.8% |
OM growth 3Y7.42%
OM growth 5Y1.05%
PM growth 3Y-21.47%
PM growth 5Y-5.38%
GM growth 3Y0.43%
GM growth 5Y0.66%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SAP is still creating some value.
SAP has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, SAP has less shares outstanding
Compared to 1 year ago, SAP has a worse debt to assets ratio.
2.2 Solvency
SAP has an Altman-Z score of 8.16. This indicates that SAP is financially healthy and has little risk of bankruptcy at the moment.
SAP has a better Altman-Z score (8.16) than 79.61% of its industry peers.
SAP has a debt to FCF ratio of 1.35. This is a very positive value and a sign of high solvency as it would only need 1.35 years to pay back of all of its debts.
SAP has a Debt to FCF ratio of 1.35. This is in the better half of the industry: SAP outperforms 75.73% of its industry peers.
SAP has a Debt/Equity ratio of 0.15. This is a healthy value indicating a solid balance between debt and equity.
SAP has a Debt to Equity ratio of 0.15. This is in the better half of the industry: SAP outperforms 67.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.35 | ||
| Altman-Z | 8.16 |
ROIC/WACC1.72
WACC7.57%
2.3 Liquidity
A Current Ratio of 1.03 indicates that SAP should not have too much problems paying its short term obligations.
SAP has a worse Current ratio (1.03) than 63.11% of its industry peers.
SAP has a Quick Ratio of 1.03. This is a normal value and indicates that SAP is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of SAP (1.03) is worse than 62.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.03 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 16.56% over the past year.
The Earnings Per Share has been decreasing by -2.38% on average over the past years.
The Revenue has grown by 10.29% in the past year. This is quite good.
SAP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.40% yearly.
EPS 1Y (TTM)16.56%
EPS 3Y-12.45%
EPS 5Y-2.38%
EPS Q2Q%36.36%
Revenue 1Y (TTM)10.29%
Revenue growth 3Y7.07%
Revenue growth 5Y4.4%
Sales Q2Q%8.92%
3.2 Future
Based on estimates for the next years, SAP will show a very strong growth in Earnings Per Share. The EPS will grow by 20.23% on average per year.
Based on estimates for the next years, SAP will show a quite strong growth in Revenue. The Revenue will grow by 12.17% on average per year.
EPS Next Y39.67%
EPS Next 2Y29.72%
EPS Next 3Y25.76%
EPS Next 5Y20.23%
Revenue Next Year9.78%
Revenue Next 2Y10.71%
Revenue Next 3Y11.52%
Revenue Next 5Y12.17%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 44.54, the valuation of SAP can be described as expensive.
Based on the Price/Earnings ratio, SAP is valued a bit cheaper than the industry average as 60.19% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.03, SAP is valued quite expensively.
The Price/Forward Earnings ratio is 32.49, which means the current valuation is very expensive for SAP.
Based on the Price/Forward Earnings ratio, SAP is valued a bit cheaper than the industry average as 61.16% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of SAP to the average of the S&P500 Index (36.28), we can say SAP is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.54 | ||
| Fwd PE | 32.49 |
4.2 Price Multiples
SAP's Enterprise Value to EBITDA ratio is in line with the industry average.
61.16% of the companies in the same industry are more expensive than SAP, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.27 | ||
| EV/EBITDA | 25.58 |
4.3 Compensation for Growth
SAP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
SAP has a very decent profitability rating, which may justify a higher PE ratio.
SAP's earnings are expected to grow with 25.76% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.12
PEG (5Y)N/A
EPS Next 2Y29.72%
EPS Next 3Y25.76%
5. Dividend
5.1 Amount
SAP has a yearly dividend return of 0.94%, which is pretty low.
Compared to an average industry Dividend Yield of 2.05, SAP pays a better dividend. On top of this SAP pays more dividend than 84.47% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, SAP's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
5.2 History
The dividend of SAP is nicely growing with an annual growth rate of 7.95%!
Dividend Growth(5Y)7.95%
Div Incr Years1
Div Non Decr Years6
5.3 Sustainability
SAP pays out 41.94% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of SAP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP41.94%
EPS Next 2Y29.72%
EPS Next 3Y25.76%
FRA:SAP (8/6/2025, 2:40:29 PM)
247.65
+1 (+0.41%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners40.46%
Inst Owner ChangeN/A
Ins Owners5.09%
Ins Owner ChangeN/A
Market Cap287.34B
Analysts77.95
Price Target290.35 (17.24%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
Yearly Dividend2.2
Dividend Growth(5Y)7.95%
DP41.94%
Div Incr Years1
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.72%
Min EPS beat(2)1.63%
Max EPS beat(2)9.81%
EPS beat(4)3
Avg EPS beat(4)2.93%
Min EPS beat(4)-1.57%
Max EPS beat(4)9.81%
EPS beat(8)4
Avg EPS beat(8)-2.96%
EPS beat(12)6
Avg EPS beat(12)9.64%
EPS beat(16)8
Avg EPS beat(16)8.76%
Revenue beat(2)0
Avg Revenue beat(2)-1.65%
Min Revenue beat(2)-1.7%
Max Revenue beat(2)-1.6%
Revenue beat(4)1
Avg Revenue beat(4)-0.54%
Min Revenue beat(4)-1.7%
Max Revenue beat(4)1.74%
Revenue beat(8)2
Avg Revenue beat(8)-0.56%
Revenue beat(12)3
Avg Revenue beat(12)-1.22%
Revenue beat(16)5
Avg Revenue beat(16)-1.09%
PT rev (1m)0.06%
PT rev (3m)2.34%
EPS NQ rev (1m)-4.17%
EPS NQ rev (3m)-8.74%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)-0.82%
Revenue NQ rev (3m)-4.11%
Revenue NY rev (1m)-0.96%
Revenue NY rev (3m)-1.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.54 | ||
| Fwd PE | 32.49 | ||
| P/S | 8.01 | ||
| P/FCF | 44.27 | ||
| P/OCF | 39.47 | ||
| P/B | 7.01 | ||
| P/tB | 28.25 | ||
| EV/EBITDA | 25.58 |
EPS(TTM)5.56
EY2.25%
EPS(NY)7.62
Fwd EY3.08%
FCF(TTM)5.59
FCFY2.26%
OCF(TTM)6.27
OCFY2.53%
SpS30.93
BVpS35.34
TBVpS8.77
PEG (NY)1.12
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.56% | ||
| ROE | 15.95% | ||
| ROCE | 19.67% | ||
| ROIC | 13% | ||
| ROICexc | 16.33% | ||
| ROICexgc | 73.27% | ||
| OM | 27.04% | ||
| PM (TTM) | 18.23% | ||
| GM | 73.8% | ||
| FCFM | 18.08% |
ROA(3y)5.45%
ROA(5y)6.51%
ROE(3y)8.93%
ROE(5y)11.53%
ROIC(3y)8.58%
ROIC(5y)8.51%
ROICexc(3y)10.69%
ROICexc(5y)10.46%
ROICexgc(3y)47.04%
ROICexgc(5y)47.34%
ROCE(3y)12.97%
ROCE(5y)12.91%
ROICexcg growth 3Y10.63%
ROICexcg growth 5Y-0.71%
ROICexc growth 3Y15.06%
ROICexc growth 5Y4.05%
OM growth 3Y7.42%
OM growth 5Y1.05%
PM growth 3Y-21.47%
PM growth 5Y-5.38%
GM growth 3Y0.43%
GM growth 5Y0.66%
F-Score8
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.35 | ||
| Debt/EBITDA | 0.56 | ||
| Cap/Depr | 59.76% | ||
| Cap/Sales | 2.2% | ||
| Interest Coverage | 17.61 | ||
| Cash Conversion | 66.02% | ||
| Profit Quality | 99.22% | ||
| Current Ratio | 1.03 | ||
| Quick Ratio | 1.03 | ||
| Altman-Z | 8.16 |
F-Score8
WACC7.57%
ROIC/WACC1.72
Cap/Depr(3y)55.18%
Cap/Depr(5y)51.03%
Cap/Sales(3y)2.6%
Cap/Sales(5y)2.73%
Profit Quality(3y)146.95%
Profit Quality(5y)133.59%
High Growth Momentum
Growth
EPS 1Y (TTM)16.56%
EPS 3Y-12.45%
EPS 5Y-2.38%
EPS Q2Q%36.36%
EPS Next Y39.67%
EPS Next 2Y29.72%
EPS Next 3Y25.76%
EPS Next 5Y20.23%
Revenue 1Y (TTM)10.29%
Revenue growth 3Y7.07%
Revenue growth 5Y4.4%
Sales Q2Q%8.92%
Revenue Next Year9.78%
Revenue Next 2Y10.71%
Revenue Next 3Y11.52%
Revenue Next 5Y12.17%
EBIT growth 1Y34.62%
EBIT growth 3Y15.02%
EBIT growth 5Y5.49%
EBIT Next Year58.56%
EBIT Next 3Y28.56%
EBIT Next 5Y20.54%
FCF growth 1Y22.34%
FCF growth 3Y-6.56%
FCF growth 5Y10.55%
OCF growth 1Y18.64%
OCF growth 3Y-5.69%
OCF growth 5Y8.35%