SAP leads the DAX index, with Rheinmetall trailing behind, backed by support
In a recent report, analyst Charles Brennan from Jefferies highlighted SAP's cloud business as a key lever for sustainable growth. This optimistic outlook towards SAP (WKN: 716460) was echoed by JPMorgan, who expressed cautious optimism towards the German software giant.
The recent decline in SAP stock, which fell below the stop-loss level during the recent correction and was sold, seems to have been met with resilience. Despite being among the weakest in the 3-month comparison in the DAX, SAP's long-term growth prospects are strong.
Oracle and SAP hype has faded, providing valuable insights for investors. As a result, many are adding SAP stock to their watchlist and waiting for clear positive signals. Jefferies maintains a "Buy" rating for SAP, while JPMorgan has it on their "Analyst Focus List."
Toby Ogg, an analyst from JPMorgan, maintains an "Overweight" rating for SAP and has a price target of 290 euros for the stock. This is in line with Charles Brennan's expectations for SAP stock to recover from its recent weakness.
The continued positive analyses by Jefferies and JPMorgan on SAP stock indicate their belief in the company's multiple growth levers, especially in the cloud business and future free cash flow. They consider current market weakness and competitive pressures as temporary and possibly exaggerated, emphasizing robust scenarios for SAP's order intake and cash flow compared to some market skeptics.
SAP's CFO was involved in a conversation discussed by Jefferies analysts, further underscoring the analyst's confidence in the company's growth prospects. This confidence was reflected in SAP stock's significant recovery midweek, gaining nearly four percent.
Notably, SAP stock led the German benchmark index DAX in its recovery, suggesting a strong comeback for the tech giant. Moreover, SAP remains unfazed by Salesforce, receiving a double buy recommendation.
Charles Brennan's comments were made in a Tuesday report, and it seems that the optimism towards SAP is set to continue. Initially, reclaiming the 38-day line would be crucial for SAP stock, but with the positive outlook from analysts, it seems that the German software giant is well-positioned for sustainable growth.
