SAP is showing a new pace of change and is regaining connection with Big Tech – and trust on the stock market
Commentary on the software company by Heidi Rohde – Börsen-Zeitung
In the end, SAP icon Hasso Plattner can be satisfied with the timing of his departure. In May, he will hand over supervision of a company that, after a transformational effort, is showing the promised profit momentum and thus strengthening credibility with investors. This manifests itself in a price increase of more than 7% for the DAX heavyweight, a signal of confidence in which the market appears undeterred by the consequences with which the announced restructuring program will be reflected in the figures for the current year. Because the 2 billion euros spent on this will naturally initially eat into profits and cash flow.
Driver AI
More important than this small dent, which SAP is ironing out in terms of communication with slightly raised targets for 2025, is the signal of a new increased agility, which the software company also underlines by the fact that it reacts immediately to technologically driven changes in its own personnel structure. This means that the group is also gaining access to Big Tech at this level. US giants such as Microsoft, Alphabet and Nvidia owe their growth and profitability not only to their own ability to innovate, but also to their rapid and courageous adaptation to new technologies with disruptive potential. The Windows Company in particular has recently redeployed its resources in a short space of time and made a substantial difference Job cuts quickly flanked with new hires in the field of artificial intelligence (AI).
Jerk at the capping limit
In principle, SAP is taking a similar path by rebuilding the 8,000 jobs that will be lost elsewhere. This distinguishes the conversion from a mere red pencil project. CEO Christian Klein is operating from a position of strength after two exhausting years in which investors at SAP had lowered their thumbs so far that his chair seemed to wobble. However, he cannot rest on his laurels. AI will further accelerate the development cycles in software, and Klein would be well advised not to overstress (investor’s) confidence in self-driven growth. A bold M&A strategy is also part of Big Tech’s recipe for success. US investors in particular value them.
Meanwhile, German investors have to hope that SAP’s new proximity to Big Tech doesn’t trigger wanderlust. The increase in the cap limit in mid-March in the Dax comes not a day too early for the heaviest index title, which, with a new record high, now has a weight of a good 12%.
Selected leverage products on SAP
With knock-outs, speculative investors can participate disproportionately in price movements. Simply select the lever you want and we will show you suitable open-end products on SAP
The leverage must be between 2 and 20
Advertising