Back in November 2025, we discussed SAP in detail as a European software heavyweight with attractive long-term prospects. At the time, the stock was trading around €220, and we indicated that a further correction towards the €180 zone could be expected before room would be created for a renewed upward move. Since then, SAP has published its fourth-quarter and full-year 2025 results. While these figures were strong from both an operational and strategic perspective, the market reaction was notably negative. SAP shares came under significant pressure, even falling below the lower boundary we had previously identified. In our view, this development is precisely why the stock deserves renewed attention.

You can read the previous article here to be fully informed: 'SAP: European heavyweight prepares for next rise'.

What are the developments at SAP since November 2025?

Since November 2025, SAP has published its figures for the fourth quarter and the full fiscal year 2025. For the year, SAP reported revenue of €36.8 billion, representing an increase of 8% compared with 2024. In addition, 86% of total revenue now consists of predictable, recurring income, confirming the company’s structural shift towards a stable cloud-based business model.

Despite these solid results, the market reaction was negative. Investors focused primarily on the slightly slower growth of the cloud backlog and the outlook for 2026, which led to a sharp decline in SAP shares immediately following the publication. However, this price reaction appears to have been largely driven by short-term expectations, while the underlying operational trend remains intact.

Strong cloud development offers multi-year growth potential

The cloud business remains the foundation of SAP’s growth story. In the fourth quarter, cloud revenue grew by 19% to €5.61 billion, driven by the Cloud ERP Suite and the increasing adoption of SAP Business AI. The cloud backlog rose to €21.05 billion, providing high revenue visibility for the coming years.

For 2026, SAP expects this trend to continue. Cloud revenue is estimated at between €25.8 billion and €26.2 billion, representing growth of approximately 23% to 25% compared with 2025. Combined cloud and software revenue is projected at €36.3 billion to €36.8 billion, an increase of around 12% to 13% year-on-year. This outlook underscores SAP’s continued transformation into a company characterised by predictable growth, expanding margins and strong cash flows, offering scope for further value creation over the longer term.

What is analysts’ view on SAP’s share price?

Despite the recent decline in the share price, analysts remain predominantly positive about SAP’s prospects. The average price target stands at around €280, which is well above the current share price level. Most price targets are clustered in a range of approximately €270 to €310, with some more optimistic projections reaching up to €345. While several analysts have slightly adjusted their estimates following the publication of the latest quarterly results, the overall consensus remains that SAP is attractively positioned for further share price appreciation over the medium to long term, provided that its cloud strategy and profitability continue to progress.

What is Yelza's view on SAP's share price?

The chart below shows SAP’s share price from mid-2022 onwards. The arrows provide a clear indication of the most likely scenario.

In line with analysts’ expectations, we maintain our unchanged view. As concluded in our previous article on this European heavyweight, once the current corrective phase has been completed, SAP has a solid fundamental foundation to return to its previous record high. Following a subsequent healthy consolidation phase, there is scope for a further advance towards the long-term price target of €360.

After a strong price increase of more than 250% between the summer of 2022 and early 2025, the share entered a healthy corrective phase. At that stage, we considered building a position around the €180 level. From this area, the upside potential towards the previously defined price target remains attractive, with longer-term scope towards €360.

Conclusion

SAP’s recent share price decline contrasts with its strong operational performance and solid outlook for the coming years. The 2025 results confirm that the transition towards cloud and AI continues at pace, supported by growing revenue, expanding margins and an increasing share of recurring income. While the market is currently focused on more moderate near-term expectations for 2026, SAP’s underlying fundamentals remain convincingly strong.

Given the current corrective phase, consideration may be given to adding the stock to the portfolio at current price levels, with a view to an attractive medium to long-term risk-return profile.

The results for the first quarter of 2026 are scheduled to be published on 23 April.

Disclaimer: Investing involves risk. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. They are therefore for educational purposes only.