The shares of SAP, Europe’s largest software company, took a huge slide on Monday after revising the financial outlook downwards. The stock traded 22% lower around €98 around the close of today’s market.
SAP stated “Lockdowns have been reintroduced in some regions, recovery is uneven and companies are facing more business uncertainty” and as a result, SAP cut its revenue and operating profit forecasts for 2020.
Outlook delay almost 2 years
Due to the COVID-19 epidemic, SAP does not expect to achieve its revenue and operating profit targets until 2025. Instead of a turnover of € 35 million in 2023, it now forecasts a turnover of € 36 billion and an adjusted operating profit of 11.5 billion in 2025.
Here is how analysts are reacting:
- JP Morgan cut its price target for SAP to 120 from 160 euros and downgraded the stock to “neutral” from “overweight”.
- German NordLB upgraded the stock to “buy” from “neutral”, while lowering its price target from 128 to 115 euros.
