SAP SE (SAP) Downgraded to “Sell” at Zacks Investment Research

SAP SE (NYSE:SAP) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research note issued to investors on Monday, July 24th.

According to Zacks, “SAP’s second-quarter 2017 IFRS earnings per share of €0.56 missed the Zacks Consensus Estimate and declined 17.7% from the year-ago figure. An increase in the share-based compensation expenses and restructuring expenses proved to be a drag on the bottom line. Rise in operational expenses remains a concern. Moreover, intensifying competition in the IT services industry, sluggish global economy and currency fluctuations are affecting profits. Moreover, inherent seasonality in clients’ technology spending exposes the company’s sales to risks of quarterly fluctuations. Weaknesses in key end markets add to the woes. Over the past three months, SAP’s shares have underperformed the Zacks categorized Computer-Software industry average. On the flip side, SAP’s resilient Cloud and Software business, an enviable business network spread and dominance over critical client demand areas continue to drive top-line growth.”

Several other analysts have also weighed in on the company. BMO Capital Markets boosted their price objective on SAP SE from $105.00 to $110.00 and gave the company a “market perform” rating in a report on Friday, July 21st. DZ Bank AG reissued a “buy” rating on shares of SAP SE in a report on Thursday, July 20th. Royal Bank Of Canada boosted their price objective on SAP SE from $102.00 to $106.00 and gave the company a “sector perform” rating in a report on Tuesday, July 18th. Stifel Nicolaus reaffirmed a “sell” rating and set a $75.00 target price on shares of SAP SE in a report on Friday, July 14th. Finally, Goldman Sachs Group, Inc. (The) reaffirmed a “buy” rating on shares of SAP SE in a report on Monday, June 26th. Two research analysts have rated the stock with a sell rating, five have assigned a hold rating and thirteen have issued a buy rating to the company’s stock. The company currently has a consensus rating of “Buy” and an average price target of $95.69.

SAP SE (SAP) traded up 0.63% during mid-day trading on Monday, reaching $104.46. The company’s stock had a trading volume of 573,711 shares. The firm has a 50-day moving average of $105.15 and a 200-day moving average of $100.42. The stock has a market capitalization of $125.24 billion, a price-to-earnings ratio of 30.81 and a beta of 1.12. SAP SE has a 52 week low of $80.93 and a 52 week high of $108.72.

SAP SE declared that its Board of Directors has initiated a stock buyback program on Thursday, July 20th that allows the company to buyback shares. This buyback authorization allows the software maker to repurchase shares of its stock through open market purchases. Stock buyback programs are typically an indication that the company’s management believes its stock is undervalued.

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Several institutional investors have recently modified their holdings of SAP. Reliance Trust Co. of Delaware increased its position in shares of SAP SE by 5.1% in the first quarter. Reliance Trust Co. of Delaware now owns 11,564 shares of the software maker’s stock valued at $1,135,000 after buying an additional 556 shares in the last quarter. Howe & Rusling Inc. increased its stake in SAP SE by 25.4% in the first quarter. Howe & Rusling Inc. now owns 2,007 shares of the software maker’s stock worth $197,000 after buying an additional 407 shares during the period. Howard Capital Management increased its stake in SAP SE by 3.7% in the first quarter. Howard Capital Management now owns 125,741 shares of the software maker’s stock worth $12,344,000 after buying an additional 4,500 shares during the period. Atria Investments LLC increased its stake in SAP SE by 0.6% in the first quarter. Atria Investments LLC now owns 15,337 shares of the software maker’s stock worth $1,506,000 after buying an additional 86 shares during the period. Finally, Capstone Asset Management Co. increased its stake in SAP SE by 7.4% in the first quarter. Capstone Asset Management Co. now owns 92,829 shares of the software maker’s stock worth $9,113,000 after buying an additional 6,430 shares during the period. Institutional investors and hedge funds own 3.77% of the company’s stock.

About SAP SE

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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