UPDATE: BMO Capital Markets Reiterates Market Perform Rating, Raises PT on SAP AG
In a report published Friday, BMO Capital Markets reiterated its Market Perform rating on SAP AG (NYSE: SAP), and raised its price target from $70.00 to $75.00.
BMO Capital Markets noted, “Our checks suggest that SAP does not have material traction with BusinessObjects (~15%-20% of SAP's overall mix), due in part to SAP focusing more on HANA rather than investing in improving BusinessObjects functionality. While SAP's analytics suite surprised in 3Q12, we conclude that this outperformance will be tough to sustain. One check argued that MicroStrategy license sales are likely flat or shrinking and our checks on Qlik remain neutral to positive. Yesterday, SAP announced that its Business Suite ERP applications have been optimized to use HANA as the underlying in-memory database and that it is now ahead of plan in meeting its target for €20 billion in revenues by 2015. Both announcements are positive, although we're skeptical about the willingness of large enterprises to run their SAP applications on HANA. We remain neutral on SAP given the maturity of the core ERP market and the run in the stock.”
SAP AG closed on Thursday at $82.40.
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Tags: BMO Capital Markets