SAP  Sap Ag

Exchange

NYSE

Sector

Technology

Industry

Computer Software: Prepackaged Software

Market Cap.

117.51B

Vuru Grade

64.91/100

Current Price

$98.04
-0.45 (-0.46%)

Growth Price

$62.02
Overvalued by 36.74%

Stability Price

$36.56
Overvalued by 62.71%

Company Metrics

  • P/E 30.02
  • P/S 4.98
  • P/B 4.17
  • EPS 3.27
  • Cash ROIC 13.81%
  • Cash Ratio 0.40
  • Dividend 1.31 / 1.34%
  • Avg. Vol. 809,333.00
  • Shares 1.20B
  • Market Cap. 117.51B

Company Description

SAP AG provides business software primarily in Europe, the Middle East, Africa, the Americas, and the Asia Pacific Japan region. The company's product portfolio includes SAP Business Suite software, which supports large organizations/international corporations in their core business operations, such as supplier relationship, production, warehouse management, sales, administration, and customer rel... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

SAP SE (ADR) (SAP) Reaches $98.31 After 7.00% Gap Up; Fulton Breakefield ...
Herald KS - Mar 28, 2017
The stock of SAP SE (ADR) (NYSE:SAP) gapped up by $0.48 today and has $105.19 target or 7.00% above today's $98.31 share price.
SAP SE (ADR) (SAP) is Downgraded by UBS to ” Neutral” - Highland Mirror
Sap Ag (SAP) Hit By UBS Securities Downgrade; Shorts at Siteone Landscape ... - Wolcott Daily
SAP SE (ADR) (SAP) Reaches $98.45 After 8.00% Up Move, Columbus Circle ...
Herald KS - Mar 28, 2017
The stock of SAP SE (ADR) (NYSE:SAP) is a huge mover today! About 367,866 shares traded. SAP SE (ADR) (NYSE:SAP) has risen 10.40% since August 19, 2016 and is uptrending.
SAP SE (ADR) Struggles To Compete With Cloud-Based Competitors
ValueWalk - Jan 20, 2015
Late last year, SAP SE (ADR) (NYSE:SAP) had already cut its profit forecast thanks to the expense of setting up cloud-based infrastructure.
SAP Q4 Earnings and Revenues Beat on SAP HANA Momentum - Analyst Blog - Nasdaq
SAP SE Sees Growth Far and Wide
Yahoo Finance - Feb 13, 2017
SAP Societas Europaea (SAP), the $113.7 billion software company reported its fourth-quarter and full-year 2016 several weeks ago.
SAP SE (ADR) (SAP) Reaches $97.07 52-Week High, Envirostar (NYSEMKT:EVI ...
Herald KS - Mar 16, 2017
The stock of SAP SE (ADR) (NYSE:SAP) hit a new 52-week high and has $102.89 target or 6.00% above today's $97.07 share price.
Apple Inc. (NASDAQ:AAPL) Partners With SAP SE (ADR) (NYSE:SAP) on iPhone, iPad ...
Market Exclusive - May 6, 2016
SAP SE (ADR) (NYSE:SAP) and Apple Inc. (NASDAQ:AAPL) have created a partnership that will oversee the creation of an enterprise app for iPhones and iPads.
Has SAP SE (ADR) (NYSE:SAP) Missed The Cloud Race?
InvestCorrectly - Apr 23, 2015
SAP SE (ADR) (NYSE:SAP), the king of enterprise applications, isn't living like a king in the cloud business thanks to its late entry into the segment.
SAP SE (ADR) (SAP) To Cut Up To 2200 Jobs
InvestCorrectly - Mar 9, 2015
Enterprise software company, SAP SE (ADR) (NYSE:SAP), plans to reduce its workforce as it transitions to cloud offerings.
What Should You Know About SAP SE (ADR)(NYSE:SAP)?
InvestCorrectly - Mar 16, 2016
A spike in expenses relating to revenue and administration poured cold water on SAP SE (ADR)(NYSE:SAP)'s 4Q2015 and full-year 2015 earnings.
SAP SE (ADR) (NYSE:SAP) Increases Focus On Cloud
InvestCorrectly - Mar 31, 2016
SAP SE (ADR) (NYSE:SAP) is constantly increasing its focus on the cloud in line with market trends so as to take advantage of the available opportunities.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for SAP to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate SAP's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$98.04 Current Price

$62.02 Growth Price (DCF)

Overvalued by 36.74%


Growth Rate Assumed by Market: 23.65%


Future Free Cash Flow Growth Rate: 5.6%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$36.56 Stability Price (EPV)

Overvalued by 62.71%


Discount Rate: 15.0%

$181.21 Book Price

Undervalued by 84.83%


Shrinking Cash Return on Invested Capital over the past 5 years

SAP has less efficiently invested its financial resources in buildings, projects, and equipment, resulting in increasingly weaker returns. Look at its Annual Reports to determine whether this decrease has been caused by one-time events or a more general decrease in investment returns.

SAP has created $13.81 of cash for every $100 invested.
Figures in EUR. Fiscal year ends in December
20122013201420152016
Free Cash Flow 3.28B 3.27B 2.76B 3.00B 3.63B
divided by
Invested Capital 17.56B 17.96B 26.59B 30.09B 30.71B
Cash ROIC 18.68% 18.18% 10.39% 9.98% 11.81%

Excellent Return on Equity over the past 5 years

Over the past 5 years, SAP has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

SAP has generated $16.88 of Earnings for every $100 of Shareholders' Equity.
Figures in EUR. Fiscal year ends in December
20122013201420152016
Net Income 2.82B 3.33B 3.28B 3.06B 3.63B
divided by
Stockholders' Equity 14.16B 16.04B 19.50B 23.27B 26.38B
Return on Equity 19.93% 20.73% 16.82% 13.13% 13.78%

Excellent Business Performance over the past 10 years

SAP has been able to maintain profitability in good times and bad. This could mean SAP has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

SAP has created positive free cash flow for 9 or more of the past 10 years.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 1.54B 1.82B 2.79B 2.60B 3.33B 3.28B 3.27B 2.76B 3.00B 3.63B

Good Balance Sheet

SAP's Total Assets double Total Liabilities. Its financial position is adequate. Remember to check Shareholders' Equity to see if it's stable or growing. It's one of the best measures of whether a company is creating value for shareholders.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 2.20B 1.66B 2.37B 3.68B 5.78B 2.63B 2.79B 3.37B 3.44B 3.90B
Current Assets 6.40B 5.79B 5.26B 7.14B 9.67B 7.00B 7.35B 8.98B 9.74B 11.56B
Total Assets 10.35B 14.22B 13.37B 20.84B 23.23B 26.84B 27.09B 38.51B 41.39B 44.28B
Current Liabilities 3.20B 5.84B 3.42B 5.15B 6.27B 6.64B 6.35B 8.54B 7.87B 9.67B
Total Liabilities 3.86B 6.97B 4.90B 11.03B 10.53B 12.67B 11.05B 19.00B 18.12B 17.90B
Stockholder' Equity 6.50B 7.24B 8.48B 9.81B 12.70B 14.16B 16.04B 19.50B 23.27B 26.38B
Current Ratio 2.00 0.99 1.54 1.39 1.54 1.05 1.16 1.05 1.24 1.20
TL-to-TA 0.37 0.49 0.37 0.53 0.45 0.47 0.41 0.49 0.44 0.40

Consistent Reinvestment of Profits over the past 10 years

SAP has consistently retained profits. This may put SAP in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, SAP can greatly improve their long-term economic picture.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 7.15B 7.72B 8.57B 9.77B 12.47B 13.97B 16.26B 18.32B 20.04B 22.30B
Retained Earnings Growth - 7.96% 11.04% 13.95% 27.63% 12.09% 16.35% 12.66% 9.43% 11.27%

Potential Competitive Advantage over the past 10 years

SAP potentially has a competitive advantage. This could be strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will strengthen.

$17.70 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 1.92B 1.87B 1.75B 1.81B 3.44B 2.82B 3.33B 3.28B 3.06B 3.63B
divided by
Revenue 10.23B 11.58B 10.67B 12.46B 14.23B 16.22B 16.82B 17.56B 20.79B 22.06B
Net Profit Margin 18.74% 16.15% 16.38% 14.53% 24.16% 17.40% 19.77% 18.68% 14.70% 16.47%

Strong Pricing Power over the past 10 years

SAP has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$70.18 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 6.83B 7.63B 7.11B 8.57B 12.29B 11.16B 11.82B 12.29B 14.17B 15.48B
divided by
Revenue 10.23B 11.58B 10.67B 12.46B 14.23B 16.22B 16.82B 17.56B 20.79B 22.06B
Gross Margin 66.80% 65.91% 66.59% 68.76% 86.38% 68.78% 70.27% 69.98% 68.13% 70.16%

Low Capital Intensity over the past 10 years

SAP has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that SAP may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

19.03% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 400.81M 339.56M 225.00M 334.00M 445.00M 541.00M 566.00M 737.00M 636.00M 1.00B
divided by
Net Income 1.92B 1.87B 1.75B 1.81B 3.44B 2.82B 3.33B 3.28B 3.06B 3.63B
Capital Expenditure Ratio 20.91% 18.15% 12.87% 18.44% 12.94% 19.16% 17.02% 22.47% 20.81% 27.55%

Very Strong Dividend History over the past 10 years

SAP has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests SAP is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 555.38M 594.94M 594.00M 594.00M 741.00M 1.31B 1.01B 1.19B 1.32B 1.38B
divided by
Shares Outstanding 1.21B 1.19B 1.19B 1.19B 1.19B 1.19B 1.20B 1.20B 1.20B 1.20B
Dividend Paid Per Share 0.62 0.67 0.67 0.67 0.83 1.47 1.13 1.34 1.47 1.54
Price at Year End 48.67 34.19 46.05 49.61 52.95 79.39 86.63 70.40 80.15 86.43
Dividend Yield 1.27% 1.96% 1.45% 1.35% 1.57% 1.85% 1.31% 1.90% 1.83% 1.78%

History of Stock Buybacks over the past 10 years

SAP has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in EUR. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 1.21B 1.19B 1.19B 1.19B 1.19B 1.19B 1.20B 1.20B 1.20B 1.20B
Stock Bought Back - 1.24% 0.17% - -0.08% -0.25% -0.17% -0.17% -0.08% -0.08%
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