SAP SE (SAP.DE) Stock Fundamental Analysis
Europe - FRA:SAP - DE0007164600 - Common Stock
236.85 EUR
-3.55 (-1.48%)
We assign a fundamental rating of 6 out of 10 to SAP. SAP was compared to 110 industry peers in the Software industry. While SAP belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. SAP is quite expensive at the moment. It does show a decent growth rate.
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.
Each year in the past 5 years SAP has been profitable.
In the past 5 years SAP always reported a positive cash flow from operatings.
1.2 Ratios
SAP has a Return On Assets of 9.56%. This is amongst the best in the industry. SAP outperforms 80.91% of its industry peers.
SAP has a better Return On Equity (15.95%) than 72.73% of its industry peers.
SAP has a better Return On Invested Capital (13.00%) than 82.73% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SAP is below the industry average of 12.42%.
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's Profit Margin of 18.23% is fine compared to the rest of the industry. SAP outperforms 76.36% of its industry peers.
SAP's Profit Margin has declined in the last couple of years.
SAP's Operating Margin of 27.04% is amongst the best of the industry. SAP outperforms 86.36% of its industry peers.
In the last couple of years the Operating Margin of SAP has remained more or less at the same level.
The Gross Margin of SAP (73.80%) is comparable to the rest of the industry.
SAP's Gross Margin has been stable in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SAP is 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 8.00. This indicates that SAP is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of SAP (8.00) is better than 79.09% of its industry peers.
The Debt to FCF ratio of SAP is 1.35, which is an excellent value as it means it would take SAP, only 1.35 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.35, SAP is doing good in the industry, outperforming 69.09% of the companies in the same industry.
A Debt/Equity ratio of 0.15 indicates that SAP is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.15, SAP is doing good in the industry, outperforming 65.45% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.35 | ||
| Altman-Z | 8 |
ROIC/WACC1.64
WACC7.95%
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 64.55% 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.
Looking at the Quick ratio, with a value of 1.03, SAP is doing worse than 62.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.03 | ||
| Quick Ratio | 1.03 |
3. Growth
3.1 Past
SAP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.56%, which is quite good.
Measured over the past years, SAP shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.38% on average per year.
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 20.96% on average per year.
SAP is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.52% yearly.
EPS Next Y36.22%
EPS Next 2Y27.37%
EPS Next 3Y24.83%
EPS Next 5Y20.96%
Revenue Next Year9.63%
Revenue Next 2Y10.45%
Revenue Next 3Y11.33%
Revenue Next 5Y12.52%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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 42.60, the valuation of SAP can be described as expensive.
SAP's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 27.57. SAP is valued rather expensively when compared to this.
The Price/Forward Earnings ratio is 32.23, which means the current valuation is very expensive for SAP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SAP is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of SAP to the average of the S&P500 Index (23.09), we can say SAP is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.6 | ||
| Fwd PE | 32.23 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as SAP.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SAP is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 42.34 | ||
| EV/EBITDA | 24.92 |
4.3 Compensation for Growth
The 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.
A more expensive valuation may be justified as SAP's earnings are expected to grow with 24.83% in the coming years.
PEG (NY)1.18
PEG (5Y)N/A
EPS Next 2Y27.37%
EPS Next 3Y24.83%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.01%, SAP has a reasonable but not impressive dividend return.
SAP's Dividend Yield is rather good when compared to the industry average which is at 2.80. SAP pays more dividend than 83.64% of the companies in the same industry.
With a Dividend Yield of 1.01, SAP pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.01% |
5.2 History
On average, the dividend of SAP grows each year by 7.95%, which is quite nice.
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.
SAP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP41.94%
EPS Next 2Y27.37%
EPS Next 3Y24.83%
FRA:SAP (10/22/2025, 7:00:00 PM)
236.85
-3.55 (-1.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners40.23%
Inst Owner ChangeN/A
Ins Owners8.07%
Ins Owner ChangeN/A
Market Cap274.81B
Revenue(TTM)35.89B
Net Income(TTM)6.54B
Analysts78.92
Price Target292.64 (23.55%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.01% |
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)-1.19%
PT rev (3m)0.84%
EPS NQ rev (1m)-0.1%
EPS NQ rev (3m)-4.77%
EPS NY rev (1m)0.98%
EPS NY rev (3m)-2.48%
Revenue NQ rev (1m)0.23%
Revenue NQ rev (3m)-0.61%
Revenue NY rev (1m)-0.16%
Revenue NY rev (3m)-1.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 42.6 | ||
| Fwd PE | 32.23 | ||
| P/S | 7.66 | ||
| P/FCF | 42.34 | ||
| P/OCF | 37.75 | ||
| P/B | 6.7 | ||
| P/tB | 27.01 | ||
| EV/EBITDA | 24.92 |
EPS(TTM)5.56
EY2.35%
EPS(NY)7.35
Fwd EY3.1%
FCF(TTM)5.59
FCFY2.36%
OCF(TTM)6.27
OCFY2.65%
SpS30.93
BVpS35.34
TBVpS8.77
PEG (NY)1.18
PEG (5Y)N/A
Graham Number66.49
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%
ROICexgc growth 3Y10.63%
ROICexgc 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 |
F-Score8
WACC7.95%
ROIC/WACC1.64
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 Y36.22%
EPS Next 2Y27.37%
EPS Next 3Y24.83%
EPS Next 5Y20.96%
Revenue 1Y (TTM)10.29%
Revenue growth 3Y7.07%
Revenue growth 5Y4.4%
Sales Q2Q%8.92%
Revenue Next Year9.63%
Revenue Next 2Y10.45%
Revenue Next 3Y11.33%
Revenue Next 5Y12.52%
EBIT growth 1Y34.62%
EBIT growth 3Y15.02%
EBIT growth 5Y5.49%
EBIT Next Year56.23%
EBIT Next 3Y28.74%
EBIT Next 5Y21.3%
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%