Barclays and BMO Cut SAP SE (SAP) Price Targets but Remain Bullish

SAP SE (NYSE:SAP) is one of the 15 AI Stocks With Explosive Growth Potential.

SAP SE (NYSE:SAP) is one of the best AI stocks with explosive growth potential. On February 2, Barclays reduced its price target on SAP SE (NYSE:SAP) from $348 to $283 and maintained an Overweight rating on the stock.

This update comes after the company reported fourth-quarter results, which Barclays thinks “were softer.” However, the research firm said the drop in the share price after the results “appeared harsh.” Barclays believes many of the risks are already reflected in the stock’s current price.

Earlier, on January 30, BMO Capital also lowered its price target on SAP SE (NYSE:SAP) from $320 to $245 but kept its Outperform rating on the stock. BMO pointed to the company’s failure to meet its guidance on cloud computing business growth targets in the December quarter. This miss came even though SAP SE’s (NYSE:SAP) management had earlier expressed confidence in meeting or exceeding those targets.

The research firm pointed out that SAP SE (NYSE:SAP) “picked a poor time to miss,” especially as investors are already concerned about AI’s impact on the software industry.

Despite these concerns, BMO is “supportive of SAP’s cloud conversion story,” highlighting the company’s strong retention rate.

SAP SE (NYSE:SAP) is a German multinational software company with a leading position in enterprise applications and business AI. The company is one of the world’s largest providers of enterprise resource planning software.

While we acknowledge the potential of SAP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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