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Stock impact report

HSBC starts SAP at Hold, says stock valuation already reflects cloud growth [Yahoo! Finance]

ServiceNow, Inc. (NOW) 
Last servicenow, inc. earnings: 4/29 04:10 pm Check Earnings Report
Company Research Source: Yahoo! Finance
in the share price, hence leaving limited upside and some downside to consensus expectations. U.S. listed shares are down 3%. HSBC set a target price of EUR178, which is a downside from current EUR194 levels. It said SAP's valuation reflects its strong market position in enterprise resource planning and a solid double-digit earnings growth outlook. HSBC expects SAP's revenue to grow at a CAGR of 9.6% over 2025 to 2028, supported by continued migration of customers from on-premise software to the cloud. The bank estimates about 5% of SAP's on-premise customer base by revenue will migrate to the cloud each year, up from about 4.5% over 2022 to 2025. It said such migrations typically generate a revenue uplift of around 2.5 times for SAP. HSBC flagged downside risks to longer-term consensus estimates. Market may be overestimating the pace of cloud migration and the resulting revenue uplift, as well as assuming margin expansion that it views as optimistic. HSBC highlighted that Show less Read more
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