On Monday, Jefferies updated its price target for SAP SE (ETR:SAPG) (SAP:GR) (NYSE: SAP), a leading enterprise application software company. The firm increased the target to €205.00, up from the previous €200.00, while reiterating a Buy rating on the stock.
The revision comes after a review of SAP's annual report, which highlighted the firm's cloud backlog growth. The current cloud backlog (CCB) is projected to sustain a growth rate of approximately 27%. Jefferies notes that while there are changes lower down in the profit and loss statement (P&L) that could lead to some variability, these are not expected to significantly impact the overall investment thesis for SAP.
The firm's analyst pointed out that although the profit definitions within SAP's financial reporting have undergone changes, the investment community is likely to remain understanding. The focus for investors, according to Jefferies, continues to be on the robust growth of SAP's cloud backlog.
SAP SE is known for its comprehensive range of services and solutions that assist businesses in managing operations and customer relations. The company's cloud services are a critical part of its offerings, facilitating digital transformation for its global clientele.
By adjusting the price target, Jefferies signals its confidence in SAP's ability to maintain its momentum in the cloud sector. The new price target of €205.00 reflects the firm's positive outlook on SAP's future performance in the market.
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