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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#864
Positioning
Market Dominance
Services
Computer Software
$302.5B
Christian Klein
SAP SE, together with its subsidiaries, operates as an enterprise application software company worldwide. It offers SAP S/4HANA, an ERP suite with intelligent technologies, such as artificial intelligence, machine learning, and advanced analytics. SAP SuccessFactors Human Experience Management provides cloud-based solutions for core HR and payroll, talent management, employee experience management, and people analytics.
Headcount
112.0K
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Dates updated upon official exchange announcement.
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X-AXIS: EV/EBITDA (LOWER = CHEAPER) | Y-AXIS: ROE (HIGHER = ELITE) | RED CIRCLE = SAP ANALYSIS TARGET
| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$YALA Yalla Group Ltd | 75 | 89 | 99 | 80 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$GRVY GRAVITY Co., Ltd. | 75 | 82 | 96 | 71 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$ISSC INNOVATIVE SOLUTIONS & SUPPORT INC | 73 | 81 | 88 | 94 | 25.0x | 14.1x | 17.1% | 10.3% | 35.5% | 14.6% | 10.1% | 105.2% | 0.0% | 41.0x | $244M | VS | |
$AER AerCap Holdings N.V. | 72 | 60 | 87 | 84 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$HCSG HEALTHCARE SERVICES GROUP INC | 72 | 74 | 88 | 88 | 7.1x | 6.1x | 28.9% | 20.8% | 20.8% | 9.9% | 9.3% | 8.5% | 0.0% | 1.0x | $1.2B | VS | |
$LQDT LIQUIDITY SERVICES INC | 72 | 90 | 88 | 68 | 24.9x | 14.3x | 14.1% | 8.3% | 45.7% | 8.5% | 6.2% | 28.1% | 0.0% | 0.0x | $736M | VS | |
$TRTNpA Triton International Ltd | 71 | 70 | 89 | 70 | - | 1.7x | 0.0% | - | 97.4% | 58.0% | 37.4% | - | 8.8% | 264.0x | $2.5B | VS | |
$EDU New Oriental Education & Technology Group Inc. | 71 | 83 | 52 | 77 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$NTES NetEase, Inc. | 71 | 88 | 93 | 68 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$UTI UNIVERSAL TECHNICAL INSTITUTE INC | 70 | 86 | 86 | 72 | 43.2x | 16.0x | 15.3% | 5.8% | 100.0% | 6.9% | 5.2% | 15.1% | 0.0% | 24.0x | $1.8B | VS | |
$SAP SAP SE | 58 | 77 | 64 | 44 | 70.9x | 10.2x | 27.7% | 17.0% | 73.0% | 13.7% | 9.2% | 2.5% | 1.0% | 25.0x | $302.5B | ||
| SECTOR BENCH | - | - | - | - | - | 23.7x | 11.7x | 5.7% | 2.4% | 64.6% | 4.5% | 2.8% | 8.6% | 0.0% | 0.3x | - | REF |
SAP SE (SAP) receives a "Hold" rating with a composite score of 58.3/100. It ranks #864 out of 7,333 stocks in our coverage universe and carries a 3-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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HQ Base
Walldorf,
In-line with peers — no strong momentum signal
Trading at a discount to fundamentals — favorable entry valuation
High profitability & efficiency — strong quality floor supports entry
Low volatility — smoother ride and historically better risk-adjusted returns
Conservative, efficient capex — capital discipline signals management quality
Mid-range overall rating
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Relative valuation derived from Services sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
Projection based on user-defined inputs. Re-calculated daily against current market data.
Reverse DCF Framework — Mauboussin Methodology
Institutional-grade Reverse DCF analysis. This model identifies the growth hurdles embedded in current market prices. When implied growth is significantly lower than historical or projected rates, a margin of safety may exist. Re-audited daily.
No analyst ratings for SAP.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 77 | 92 | -15DRAG |
| MOMENTUM | 44 | 42 | +2NEUTRAL |
| VALUATION | 64 | 72 | -8DRAG |
| INVESTMENT | 63 | 97 | -34DRAG |
| STABILITY | 72 | 78 | -6DRAG |
| SHORT INT | 74 | 88 | -14DRAG |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC 141.2% vs WACC 9.5% (spread +131.6%)
GM 73% vs sector 65%, OM 14% vs sector 5%
Capital turnover 18.60x, R&D intensity 19.1%
Rev growth 2%, 8yr history
Interest coverage 4.5x, Net debt/EBITDA 0.3x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate SAP SE (SAP) as a Hold with a composite score of 58.3/100 at a current price of $196.46. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling.
SAP SE holds a top-quartile position (#0 of 50) within the Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 58.3/100 places it at rank #864 in our full universe.
Narrow
Low
Exemplary
Undervalued
Gross margins of 73% signal strong pricing power.
Returns on equity of 27.7% exceed cost of capital.
Stable competitive position in a defensive sector.
Elevated P/E ratio of 70.9x leaves little room for execution misses.
Vulnerability to macroeconomic shocks and interest rate volatility.
SAP SE represents a hold based on multi-factor quantitative performance.
Our model assigns SAP SE a Hold rating, with a composite score of 58.3/100 and 3 out of 5 stars. Ranked #864 of 7,333 stocks, SAP presents a mixed quantitative picture — neither compelling enough to initiate new positions nor weak enough to warrant selling. Investors already holding may consider maintaining their position while monitoring for changes in the factor profile.
SAP earns a quality score of 77/100, indicating above-average business quality. The company reports a return on equity of 27.7% (sector avg: 5.7%), gross margins of 73.0% (sector avg: 64.6%), net margins of 9.2% (sector avg: 2.8%). Companies in this tier generally demonstrate consistent profitability and efficient capital deployment, though they may face some competitive pressure.
SAP's value score of 64/100 indicates the stock is fairly valued based on its current fundamentals. Key valuation metrics include a P/E ratio of 70.91x, an EV/EBITDA of 10.17x, a P/B ratio of 5.02x. At this level, neither a clear bargain nor overpriced, the stock's attractiveness depends more on forward growth expectations and qualitative factors.
SAP shows a solid investment score of 63/100, reflecting measured but productive capital allocation. Key growth metrics include revenue growth of 2.5% vs. a sector average of 8.6% and a return on assets of 17.0% (sector: 2.4%). This suggests the company is investing at an appropriate level to sustain growth without overextending its balance sheet.
SAP is currently showing below-average momentum at 44/100, which may indicate weakening institutional interest or negative sentiment shifts. Revenue growth stands at 2.5% year-over-year, while a beta of 0.95 reflects its sensitivity to broader market moves. Investors should note that declining momentum can precede further price weakness, though contrarian opportunities sometimes emerge at these levels.
SAP shows good financial stability with a score of 72/100. Key stability metrics include a beta of 0.95 and a debt-to-equity ratio of 25.00x (sector avg: 0.3x). This suggests manageable leverage and moderate price volatility, making it appropriate for investors seeking a balance between growth potential and capital preservation.
SAP carries a short interest score of 74/100, indicating moderate short selling activity. This is a neutral reading — not enough to signal systemic bearishness, but worth monitoring. Specific risk factors include elevated leverage (D/E: 25.00x). At $302.5B market cap (mega-cap), SAP SE offers reasonable institutional liquidity.
SAP offers a modest dividend yield of 1.0%. While the income contribution is relatively small, even a small dividend signals management's commitment to shareholder returns and can serve as a signal of financial discipline.
SAP SE is a mega-cap company in the Services sector, ranked #0 of 50 in its sector (100th percentile) and #864 of 7,333 overall (88th percentile). Key comparisons include ROE of 27.7% exceeding the 5.7% sector median and operating margins of 13.7% above the 4.5% sector average. This top-quartile standing reflects exceptional competitive strength relative to Services peers.
While SAP currently exhibits a HOLD profile, superior opportunities exist within the SERVICES sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
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Momentum (44) is the limiting factor — improvement here would lift the composite score most.
EV/EBITDA 13% BELOW SECTOR MEDIAN (FAVORABLE)
ROE 383% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 13% ABOVE SECTOR MEDIAN (FAVORABLE)
The Buffett indicator, which measures total U.S. stock market value against GDP, has reached extremely stretched levels at 222%, only the fourth time in 60 years. This metric historically preceded major market drawdowns in 1968, 2000, and 2021. While not a guaranteed crash signal, it warns that future returns may be lower and volatility higher, especially as concerns grow about AI spending translating into profits.
Health In Tech, Inc. (Nasdaq: HIT), an AI-enabled InsurTech platform company, today announced the appointment of Sri Rajagopalan as Chief Technology Officer (CTO), effective February 23, 2026.
SAP (SAP) has reached a legal settlement with Teradata Corporation, agreeing to pay $480 million within 60 days to resolve all outstanding claims between the two companies. Teradata anticipates a net cash gain of $355 million to $362 million after legal fees and plans to discuss the utilization of these proceeds during its Q1 2026 earnings call. SAP, a leading enterprise application software provider, shows strong financial health with consistent revenue growth, expanding margins, and stable valuation metrics, despite a recent downward trend in its stock's moving averages.
SAP SE's stock dropped 13% in the last 30 days due to investors rotating out of enterprise software and a slowdown in current cloud backlog growth, despite overall strong financial results for the year. The company reported significant cloud revenue growth, record Q4 bookings, and positive outlooks for operating profit and free cash flow. Analysts indicate SAP appears undervalued, with an implied upside of 24% to 47% based on continued cloud expansion, margin durability, AI integration, and a substantial share repurchase program.
This notification from SAP SE concerns a major holdings disclosure, indicating an acquisition/disposal of shares with voting rights by BlackRock, Inc. BlackRock's total voting rights in SAP SE, including shares and instruments, now stand at 6.49%. The report details the full chain of controlled undertakings under BlackRock, Inc.
Above 50MA
37.18%
Net New Highs
+51081