(DAX, Software/IT)

SAP

(DAX, Software/IT)

A n a l y s t

Andreas Wolf

[email protected]

+49 40 309537-140

NO T E Published 19.11.2019 15:00 1

RESEARCH

Buy

EUR 145.00

Price EUR 119.58

Upside 21.3 %

Value Indicators: EUR Share data: Description:

DCF: 144.00

FCF-Value Potential 21e: 85.04

Bloomberg: SAP GR

Reuters: SAPG

ISIN: DE0007164600

Worldwide market leader in enterprise software

Market Snapshot: EUR m Shareholders: Risk Profile (WRe): 2019e

Market cap: 142,300

No. of shares (m): 1,190

EV: 150,312

Freefloat MC: 103,025

Ø Trad. Vol. (30d): 242 m

Freefloat 72.4 %

Founders 24.6 %

Treasury stock 3.0 %

Beta: 1.0

Price / Book: 6.5 x

Equity Ratio: 53 %

Net Fin. Debt / EBITDA: 1.3 x

Net Debt / EBITDA: 1.4 x

Road to 2023 ambitions should be supported by FV increase of ~50%

� Over the last decade, SAP’s predominant focus has been on broadening its product portfolio and land-grabbing in the cloud space. As SAP

has covered most of the white spots in the product portfolio, the future focus will turn to streamlining the operations without sacrificing growth.

SAP should be able to implement efficiency measures without harming growth as the measures simplify SAP’s organisational structure which

is currently characterised by multiple overlaps following its acquisition spree.

� As a result of M&A, SAP boasts a comprehensive product suite and is market leader in nearly all the addressed markets. SAP is the No. 1 in

ERP software with a worldwide market share of 25-30%, No. 1 in Human Capital Management, No. 1 in Supply Chain Management, No. 1 in

Procurement, No. 1 in Experience Management and No. 2 in Customer Relationship Management. No other vendor has a comparable suite

and position in the market as most competitors can only participate in one or two categories.

� By 2023, SAP is targeting total revenue of > EUR 35bn, > EUR 15bn cloud revenues, nearly 80% predictable revenues, 75% cloud gross

margin and 1pp operating margin increase p.a.

� The greatest lever of operating profit improvement is the Cloud gross margin optimisation which should improve by about 5pp generating

more than half of the targeted 2023 margin improvement. Further contributions to margin expansion will be made by S&M (2.5-3pp) as well as

efficiency gains in G&A and economies of scale. The R&D ratio will be maintained at about 14% to support innovation of the product portfolio.

� Including the positive margin impact in the cloud, these measures provide scope to expand the margin by 9-10 pp. However, the company is

still experiencing headwind from a growing cloud revenue share, which initially has a negative impact on margins of about 4pp. Nevertheless,

we also believe that this headwind includes a buffer which should allow SAP to exceed its medium-term targets.

� Supported by top-line growth, margin expansion and stable capex, which have become possible as a result of the cooperation with hyper

scalers, SAP’s FCF should grow by about 20%, i.e. proportionately higher growth. Our FCF estimate is about 5% higher than management’s

expectation of EUR 8bn.

� Our estimates also anticipate cloud revenues of EUR 17bn in 2023 (valuing at 10x) and about EUR 20bn with its traditional software,

maintenance and services business (valuing at 3.5x). Based on these estimates, an SOTP EV/sales-derived EV indicates a value of about

EUR 240bn or a fair value of about EUR 200 per share by 2023. This upside yields share price appreciation of about 12% p.a. which looks

attractive.

The Buy rating as well as PT of EUR 145 are confirmed.

FY End: 31.12. in EUR m

CAGR (18-21e) 2015 2016 2017 2018 2019e 2020e 2021e

Sales 8.7 % 20,798 22,062 23,460 24,707 27,674 29,486 31,690

Change Sales yoy 18.4 % 6.1 % 6.3 % 5.3 % 12.0 % 6.5 % 7.5 %

Gross profit margin 68.2 % 70.2 % 69.9 % 69.8 % 69.0 % 70.7 % 71.8 %

EBITA 10.0 % 5,229 6,073 5,838 6,674 5,530 7,511 8,885

Margin 26.6 % 29.0 % 26.2 % 28.6 % 21.4 % 26.9 % 29.4 %

EBIT adj. 12.1 % 6,346 6,629 6,770 7,164 8,180 8,943 10,104

Margin 30.5 % 30.0 % 28.9 % 29.0 % 29.6 % 30.3 % 31.9 %

EBIT 11.4 % 4,252 5,120 4,876 5,704 4,550 6,521 7,895

EPS 12.7 % 2.56 3.03 3.36 3.42 2.81 4.04 4.89

EPS adj. 12.8 % 3.77 3.89 4.45 4.35 5.14 5.53 6.25

DPS 10.1 % 1.15 1.25 1.40 1.50 1.65 1.75 2.00

Dividend Yield 1.8 % 1.7 % 1.5 % 1.6 % 1.4 % 1.5 % 1.7 %

FCFPS 2.48 3.04 3.17 2.39 3.46 5.16 5.87

FCF / Market cap 23.6 % 3.8 % 4.1 % 3.4 % 2.5 % 2.8 % 4.2 % 4.8 %

EV / Sales 4.0 x 4.2 x 4.7 x 4.7 x 5.6 x 5.1 x 4.6 x

EV / EBIT adj. 13.2 x 13.9 x 16.4 x 16.1 x 18.9 x 16.8 x 14.3 x

EV / EBIT 19.7 x 18.0 x 22.8 x 20.2 x 34.0 x 23.1 x 18.4 x

P / E 25.4 x 24.5 x 27.3 x 27.6 x 42.6 x 29.6 x 24.5 x

P / E adj. 17.3 x 19.1 x 20.6 x 21.7 x 23.3 x 21.6 x 19.1 x

FCF Potential Yield 4.8 % 4.8 % 4.1 % 4.1 % 2.9 % 4.0 % 4.6 %

Net Debt 5,752 3,468 1,594 2,603 8,011 3,405 -2,003

ROCE (NOPAT) 11.6 % 13.0 % 13.8 % 14.2 % 10.8 % 16.0 % 20.3 % Guidance: 2019: Cl.&Sw.: 8.5-10% acc.; adj EBIT: EUR 7.85-8.05bn acc.

Rel. Performance vs DAX:

1 month: -3.0 %

6 months: -5.6 %

Year to date: 15.7 %

Trailing 12 months: 14.5 %

Company events:

28.01.20 Prel. FY 2019

27.02.20 FY 2019

21.04.20 Q1

20.05.20 AGM

SAP

NO T E Publ ished 19 .11 .2019 2

RESEARCH

Sales development in EUR m

Source: Warburg Research

Sales by regions 2018; in %


EBIT development in EUR m


Company Background

� SAP has more than 430,000 customers in more than 180 countries. The product categories include: Core ERP + Suite (Business

Suite), Middleware, BI/Analytics, Database, Mobile and Cloud.

� Business Suite consists of ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), PLM (Product Lifecycle

Management), SRM (Supplier Relationship Management) and SCM (Supply Chain Management).

� Database: SAP addresses the database market via HANA (High Performance Analytics Appliance), among others. This is not just an

in-memory database but also a technology platform which accelerates other solutions.

� Cloud: SAP's solutions are designed for the cloud first and can also be deployed on premise and in private cloud environments.

� SAP addresses 25 verticals

Competitive Quality

� Strong brand: SAP is among the 30 most valuable brands worldwide.

� Enormous economies of scale: SAP is the fourth-largest software producer and the largest producer of corporate software worldwide.

� Extensive access to customers: more than 430,000 customers in over 180 countries present huge cross-selling opportunities.

� High customer tie-in: the business processes of various customers are almost inseparably linked to the software solutions of SAP.

� Strong sales channels: extensive partner network of more than 10,000 system integrators and value-added resellers.

Recurring revenues in EUR m; in %


Sales by revenue types 2018; in %


Net income development in EUR m


SAP


RESEARCH

Summary of Investment Case

Investment triggers

� The share price looks set to experience tailwind fromJ

� Jimproving growth profile as a result of a high cloud revenue share.

� JSAP’s margin expansion by 1pp p.a. over the next four years combined withJ

� Jproportionately higher FCF generation (15-25% p.a.) reaching at least EUR 8bn by 2023 (WRe).

� Operational streamlining is already being carried out and should provide sufficient visibility with regard to the efficiency of the

measures.

� SAP’s targets imply a 4pp headwind from a higher share of cloud revenues which initially come with a lower margin. In our view, this

buffer provides sufficient scope to beat market expectations.

Growth

� SAP’s cloud business should reach more than EUR 15bn by 2023; the implied growth of at least 25% appears to be conservative.

� Margin improvement by 500 basis points by 2023 should support the share price development.

� SAP increased its addressable market to USD 300bn in 2018 driven by innovations like SAP HANA. Going forward, the TAM is

expected to grow to by about 10% p.a. to USD 500bn in 2023 laying the foundation for further growth.

� As a result of the top-line expansion and higher profitability combined with approximately stable capex, FCF should reach at least

EUR 8bn by 2023.

� The share of more predictable revenues, i.e. cloud and maintenance, should approach 80% by 2023 driven by initiatives such as the

intelligent enterprise which aim to streamline customer processes which span SAP’s software applications.

Valuation

� The margin expansion combined with a growing share of cloud revenues, which improve the company’s growth profile, should support

the share price development.

� A comparison with cloud players and traditional software providers indicates that SAP’s valuation should continue to climb by about

12% p.a.

Competitive quality

� SAP isJ

� Jthe undisputed market leader in ERP software with a worldwide market share of 25-30%

� Jthe number one in Human Capital Management, the number one in supply chain, analytics, experience, and the number two in

CRM.

� No other vendor has a comparable suite and position in the market as most competitors can only participate in one or two categories.

� SAP boasts more than 430,000 customers offering massive opportunity for up-selling and cross-selling by gaining a higher share of

wallet.

SAP


RESEARCH

Company Overview

Revenue types Regional split

Sources: SAP, Warburg Research

Market position

Service spectrum and

processes

Sales modelsSubscription for cloud-based software and

services

Licenses for on-premise software and

software support

Support, Consulting, Development,

Training and other Services

2020 targets

2023 ambition

Market growth

Customers

Among a broad range of services SAP provides on-premise software solutions as well as cloud computing applications. Products

include:

- ERP systems

- Data Platforms, Warehouses and Digital Supply Chain Management

- Human Resource Management software and Customer Relationship Management

- Applications for Data Analytics, Business Intelligence and Machine Learning

- E-Commerce, Marketing, Revenue and Finance software

- Procurement and Networks

cloud revenues > EUR 15bn;

> EUR 35bn total revenue;

approaching 80% of predictable revenues;

75% cloud gross margin;

1pp operating margin increase p.a.

#1 in ERP software with a worldwide market share of 25-30%

#1 in HCM

#1 in SCM

#1 in procurement

#2 in CRM

#1 in XM (experience management)

No other vendor has a comparable suite and position in the market as most competitors can only participate in one or two

categories.

SAP boasts more than 430,000 customers in 25 verticals

EUR 8.6-9.1bn non-IFRS cloud revenue

EUR 28.6-29.2bn non-IFRS total revenue

share of more predictable revenue (defined as the total of cloud revenue and software support revenue) in a range of 70-75%

EUR 8.8-9.1bn non-IFRS operating profit

ERP: 7%, HCM: 10%, SCM: 10%; procurement: 11% p.a.; CRM: 13%

Cloud subscript. and support

499320%

Software licenses464719%

Software support1098144%

Services408617%

Germany15%

Rest of EMEA30%

USA32%

Rest of Americas7%

Japan4%

Rest of APJ12%

SAP


RESEARCH

Focusing on operational efficiency while maintaining healthy growth

Over the last decade, SAP’s predominant focus has been on broadening its product

portfolio and land-grabbing in the cloud space. Acquisitions included cloud assets such

as SuccessFactors, Ariba, Concur, Hybris or Fieldglass. As many white spots have now

been covered, there will be greater emphasis in future on integration and customers’

process optimisation (e.g. on workflows such as procurement to pay). S4 HANA is

supporting customers’ integration efforts. Cross-selling into the extensive client base will

also be a key element of SAP’s strategy to reach its targets. By 2023, SAP targets cloud

revenues of more than EUR 15bn, and total revenue of more than EUR 35bn, nearly

80% of predictable revenues, 75% cloud gross margin, and 1pp operating margin

increase p.a.

Streamlining of the product portfolio and organisation, and revenue growth will be key

themes on SAP’s agenda following the recent CEO changes. SAP should be able to

carry out its efficiency measures without sacrificing growth as the measures reflect

simplifications within SAP’s organisational structure which is currently characterised by

multiple overlaps following its acquisition spree.

As SAP’s transformation programme is already underway, management should have

sufficient insight into its effectiveness. Hence, visibility for margin enhancements should

be reliable and management should be able to meet or even exceed the growth and

profitability targets.

As a result of its takeovers, SAP achieves a better break-down of many silos, is starting

to show more coherent road maps and is delivering better integration. However,

according to e.g. SAP’s user groups, the product suite requires greater integration. This

goes beyond the API-level integration and mainly refers to user experience and the

harmonisation of data models, master data, definitions and analytical foundation as well

as application lifecycle and workflow management across all the solutions. The

integration of SuccessFactors, for example, was completed recently. The next

applications will include Intelligent Spend Group solutions Ariba, Fieldglass and Concur

as well as the CRM solution C/4 in 2020. These integration efforts are already included

in SAP’s medium-term targets and should further improve SAP’s competitive position.

SAP’s broad product suite creates massive cross-selling opportunities within its

incumbent client base which counts more than 435,000 customers. At the same time,

S/4 HANA helps the company to broaden its customer base as 40% of S/4 adopters are

net new to SAP.

The Azure collaboration allows SAP to tap inot the vast Microsoft channel and also

simplifies the hyperscaler choice for many undecided customers. SAP’s tools support

data migration and reduce integration efforts.

Cloud growth has slowed somewhat over the last couple of quarters standing at 27%

acc. in Q3. New cloud bookings have become a weaker and weaker proxy for future

growth. This is because consumption-based revenues are increasing, as they not only

occur in SAP’s Intelligent Spend product group, but also in the SAP Cloud Platform area.

Qualtrics growth exceeds the 40%-mark and is reaching critical mass which should allow

the new subsidiary to contribute to SAP’s growth in the cloud. Organic growth

contributions are made by SAP’s S/4, including supply chain in the cloud, which is

already a mid triple-digit million run rate business. SAP Cloud Platform is gaining a great

deal of traction from the collaboration with Microsoft and SAP Analytics Cloud. A growing

share of SaaS vs. IaaS supports profitability in the cloud business.

SAP


RESEARCH

Main source of margin improvement: Cloud gross margin optimisation

The greatest lever of operating profit improvement is the Cloud gross margin

optimisation which should improve by about 5pp leading to more than half of the

targeted 2023 margin improvement.

Starting from 63% in 2018, gross margin is now at 69%. Reaching 75% by 2023 would

mean almost quadrupling gross profit in the cloud compared to 2018 to over EUR 11.bn

– SAP has already achieved half of the required progress. While this progress was

achieved by migrating customers from third-part database solutions to HANA, it was only

a small cost-savings contributor. Further contributions will arise from:

� a growing share of customers’ cloud solutions running on hyperscaler clouds such as

Microsoft, AWS, Google or Alibaba. This revenue mix shift towards SaaS and its

expanding >70% gross profit margin will support overall cloud margins. Furthermore,

growth is proportionately higher in the Intelligent Spend Group (Ariba, Fieldglass

Concur) which is accompanied by > 80% gross profit margins.

� SAP’s Converged Cloud infrastructure. Via the consolidation of more than 25 cloud

stacks, networks, server or storage will be used more efficiently leading to higher

capacity utilisation.

� application management and support optimsiation (e.g. technological stack

convergence, self-service and automation, partner enablement).

Despite increased cooperations with hyperscalers, SAP will also provide its own data

center capacities in order to maintain a high level of service for customers implementing

new technologies at an early stage. The data center capacities were consolidated from

25 platforms to one (“Converged Cloud”). Overall, cloud gross margin expansion should

provide 5pp improvement by 2023.

SAP


RESEARCH

Operational efficiency

S&M to add 2.5-3pp: Over the last two years, SAP has been consolidating the overlap

of specialised sales forces as a result of M&A. The go-to-market and customer coverage

model will be streamlined further. Marketing activities, which were carried out on the

cloud business lines, are also being consolidated. SAP is also reducing overheads and

broadening digital selling and sales via its ecosystem.

G&A to add 0.5-1pp: Supported by cost-savings measures such as centralised

procurement, process automation, location optimisation and economies of scale, which

can be observed in the software industry (e.g. Workday’s G&A ratio is about 8% and

Oracle’s below 3%), margins should improve.

The R&D ratio will remain approximately stable at about 14% of revenues as capacity is

reallocated to areas of innovation to further pursue SAP’s organic innovation strategy.

Including the positive margin impact in the cloud, these measures provide room to

expand the margin by 9-10pp. However, the company is still experiencing headwind from

a growing cloud revenue share, which initially has a negative margin impact of about

4pp. Nevertheless, we also believe that this headwind contains a buffer which should

allow SAP to exceed its medium-term targets.

Bridge to 5pp margin expansion

Source:SAP

29

34

2018 Revenuemix

Cloud S&M Services R&D G&A 2023

SAP


RESEARCH

Proportionately higher FCF growth

Revenue growth in combination with the restructuring measures and the increasing

cooperation with hyperscalers allows SAP’s capex to remain stable at about EUR 1-

1.5bn. Free cash flow should increase in 2020 and reach about EUR 4.5bn. Operating

cash flow should be around EUR 6bn (including lease payments). The free cash flow

improvement leaves room for dividend repayments or a special dividend. Free cash flow

should grow at a CAGR of between 15% and 25%, i.e. faster than EPS based on lower

capex. Furthermore, debt of more than EUR 6bn will be repaid over the next four years.

SAP does not plan any significant M&A activities for the next couple of years.

Fundamentals lay the ground for annual double-digit share price growth

For pure cloud providers such as Workday, Salesforce or Servicenow, the peer group

valuation indicates EV/sales multiples of about 10-14 for the current fiscal year. On-

premise software providers, such as Oracle or Sage, are trading at about 4-5x sales.

In 2023, SAP should generate cloud revenues of EUR 17bn (valuing them at 10x) and

about EUR 20bn with its traditional software (valuing them 3.5x), maintenance and

services business (WRe) indicating an SOTP EV/sales-derived EV of about EUR 240bn

indicating that SAP shares should reach a fair value of about EUR 200 by 2023. This

upside yields share price appreciation of about 12% p.a. which looks attractive.

Cloud assets justify a significant part of the market cap

Source: Bloomberg, Warburg Research

C o mpany LC P rice M C EV

in LC in LC m in LC m 19e 20e 21e 19e 20e 21e 19e 20e 21e 19e 20e 21e

Adobe Inc USD 305.96 148,108.7 148,070.0 39.2 x 31.6 x 26.6 x 13.3 x 11.2 x 9.7 x 29.4 x 24.4 x 20.8 x 33.2 x 27.2 x 23.0 x

Dassault Systemes SE EUR 140.45 37,069.4 35,082.7 39.3 x 33.9 x 30.0 x 8.7 x 7.1 x 6.5 x 24.4 x 20.3 x 18.3 x 29.7 x 25.3 x 22.7 x

International Business M achines CorpUSD 135.32 119,844.5 174,596.5 10.6 x 10.2 x 9.5 x 2.3 x 2.2 x 2.2 x 9.6 x 9.2 x 8.7 x 14.2 x 12.1 x 11.5 x

M edallia Inc USD 31.97 4,102.8 3,783.5 n.a. neg. neg. n.a. 9.5 x 7.9 x n.a. 469.8 x 370.9 x n.a. neg. neg.

M icrosoft Corp USD 153.24 1169,038.2 1117,972.2 33.4 x 28.4 x 25.3 x 9.0 x 8.0 x 7.2 x 20.9 x 18.0 x 16.0 x 26.7 x 22.7 x 20.3 x

Oracle Corp USD 56.47 185,363.7 209,588.7 16.4 x 14.5 x 13.4 x 5.3 x 5.2 x 5.1 x 11.4 x 10.9 x 10.7 x 12.2 x 11.9 x 11.6 x

Pegasystems Inc USD 75.31 5,974.5 5,934.6 neg. 261.5 x 132.1 x 6.4 x 5.7 x 4.9 x 214.2 x 146.5 x 99.9 x neg. neg. n.a.

Sage Group PLC/The GBp 725.00 7,895.5 8,385.4 24.7 x 24.2 x 22.5 x 4.3 x 4.3 x 4.0 x 16.8 x 16.4 x 15.6 x 19.2 x 19.1 x 17.8 x

salesforce.com Inc USD 158.59 140,669.3 140,633.3 60.8 x 54.8 x 51.1 x 10.6 x 8.3 x 6.7 x 43.9 x 28.7 x 24.2 x 63.1 x 49.8 x 36.9 x

ServiceNow Inc USD 265.65 50,101.6 49,754.8 81.9 x 63.2 x 48.6 x 14.4 x 11.3 x 8.9 x 51.2 x 39.2 x 30.0 x 67.9 x 49.8 x 37.3 x

Software AG EUR 31.24 2,311.8 2,145.5 13.2 x 14.6 x 13.9 x 2.4 x 2.4 x 2.4 x 8.0 x 8.8 x 8.4 x 9.1 x 9.9 x 9.3 x

Workday Inc USD 159.74 26,676.6 36,188.0 126.4 x 89.3 x 73.3 x 12.9 x 10.0 x 8.3 x 77.1 x 48.9 x 39.9 x 129.9 x 77.0 x 58.4 x

Average 44.6 x 56.9 x 40.6 x 8.1 x 7.1 x 6.2 x 46.1 x 70.1 x 55.3 x 40.5 x 30.5 x 24.9 x

M edian 36.3 x 31.6 x 26.6 x 8.7 x 7.5 x 6.6 x 24.4 x 22.3 x 19.6 x 28.2 x 24.0 x 21.5 x

SA P SE EUR 120.00 142,800.0 150,811.5 42.6 x 29.6 x 24.5 x 5.4 x 5.1 x 4.8 x 23.9 x 18.1 x 16.2 x 33.1 x 23.1 x 19.1 x

Valuation difference to M edian -15% 7% 9% 59% 48% 39% 2% 23% 21% -15% 4% 12%

Fair value per share based on M edian 102.40 127.90 130.57 194.72 180.30 169.76 122.52 149.49 146.46 101.00 124.78 135.77

EV / Sales EV / EB IT D A EV / EB ITP / E

SAP


RESEARCH

Next data point: recent margin expansion is expected to continue

SAP is scheduled to release Q4 figures on January 28. While SAP had a weaker Q2 due

to macro-related uncertainty, Q3 was more than convincing. Some countries in Asia are

showing slow demand. Mainland China, however, is doing well. While automotive and

manufacturing where not that strong in Germany, manufacturing was the strongest

industry in Q3 on a global scale due to North America. Despite the Brexit-related

uncertainty, the UK was the strongest mature market in 2019. Retail has been the

strongest vertical for several years. Following a strong Q3 and its positive earnings

surprise, we expect another strong quarter.

Q4 reporting should support the medium target path


Despite the Qualtics acquisition which creates headwind of 40 basis points, SAP’s 2019

margin looks set to increase compared to the previous year. The margin improvement is

supported by restructuring, i.e. about 4,000 staff leaving the company. So far, about

2,500 have left and most will have left the company by the end of the year.

Consequently, the full run-rate benefit will materialise in 2020. In the context of its figures

release, the company is expected to also provide a guidance, which we expect to be in

line with its 2020 ambition, i.e.

� EUR 8.6-9.1bn non-IFRS cloud revenue,

� EUR 28.6-29.2bn non-IFRS total revenue,

� share of more predictable revenue (defined as the total of cloud revenue and software

support revenue) in a range of 70-75%,

� EUR 8.8-9.1bn non-IFRS operating profit.

A guidance in line with expectations would underpin SAP’s successful execution of its

plans as it progresses towards its 2023 targets and provides leeway for a guidance

upgrade during the course of the year.

The Buy rating as well as PT of EUR 145 are confirmed.

in EUR m Q4/ 19e Q4/ 18 yoy C o ns. ∆ Cons. 2019e 2018 yoy 2020e yoy Cons.

Sales 8,161 7,427 9.9% 8,097 0.8% 27,674 24,707 12.0% 29,486 6.5% 29,728

Cloud subscript. and support (non-IFRS) 2,078 1,412 47.2% 1,941 7.0% 7,184 5,026 42.9% 9,052 26.0% 8,995

Software licenses 2,030 2,089 -2.8% 1,985 2.3% 4,561 4,647 -1.8% 4,193 -8.1% 4,278

Software support (non-IFRS) 3,001 2,825 6.2% 2,961 1.4% 11,600 10,981 5.6% 11,832 2.0% 11,909

Cloud and software (non-IFRS) 7,109 6,326 12.4% 6,932 2.6% 23,345 20,654 13.0% 25,077 7.4% 25,097

EB IT (no n- IF R S) 2 ,812 2,540 10.7% 2,831 -0.7% 8,180 7,164 14.2% 8,943 9.3% 9,126

margin 34.5% 34.2% 35.0% 29.6% 29.0% 30.3% 30.7%

EBIT 2,179 2,393 -8.9% 2,249 -3.1% 4,550 5,704 -20.2% 6,521 43.3% 6,877

margin 26.7% 32.2% 27.8% 16.4% 23.1% 22.1% 23.1%

EP S adjusted 1.84 1.50 22.7% 1.70 8.2% 5.14 4.35 18.2% 5.53 7.6% 5.57

EPS in EUR 1.38 1.40 -1.4% 1.34 3.0% 2.81 3.42 -17.8% 4.04 43.8% 4.24

SAP

NO T E Publ ished 19 .11 .2019 10

RESEARCH

DCF model

Detailed forecast period Transitional period Term. Value

Figures in EUR m 2019e 2020e 2021e 2022e 2023e 2024e 2025e 2026e 2027e 2028e 2029e 2030e 2031e

Sales 27,674 29,486 31,690 34,225 36,690 39,067 41,345 43,516 45,571 47,509 49,326 51,025 52,046

Sales change 12.0 % 6.5 % 7.5 % 8.0 % 7.2 % 6.5 % 5.8 % 5.2 % 4.7 % 4.3 % 3.8 % 3.4 % 2.0 % 2.0 %

EBIT 4,550 6,521 7,895 9,412 10,273 11,134 11,990 12,746 13,481 14,195 14,886 15,552 16,022

EBIT-margin 16.4 % 22.1 % 24.9 % 27.5 % 28.0 % 28.5 % 29.0 % 29.3 % 29.6 % 29.9 % 30.2 % 30.5 % 30.8 %

Tax rate (EBT) 26.3 % 26.3 % 26.3 % 27.0 % 28.0 % 28.0 % 28.0 % 28.0 % 28.0 % 28.0 % 28.0 % 28.0 % 28.0 %

NOPAT 3,353 4,806 5,818 6,871 7,397 8,017 8,633 9,177 9,707 10,220 10,718 11,198 11,536

Depreciation 1,764 1,810 1,420 1,369 1,027 1,094 1,158 1,218 1,276 1,330 1,381 1,429 1,457

in % of Sales 6.4 % 6.1 % 4.5 % 4.0 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 %

Changes in provisions 122 -19 0 102 15 14 14 13 12 12 11 10 6

Change in Liquidity from

- Working Capital 814 373 453 504 505 487 467 445 421 397 373 348 209

- Capex 1,157 1,163 1,173 856 1,101 1,094 1,158 1,218 1,276 1,330 1,381 1,429 1,457

Capex in % of Sales 4.2 % 3.9 % 3.7 % 2.5 % 3.0 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 %

Other 0 0 0 0 0 0 0 0 0 0 0 0 0

Free Cash Flow (WACC Model)

3,268 5,061 5,612 6,982 6,833 7,543 8,180 8,745 9,297 9,835 10,356 10,859 11,333 11,833

PV of FCF 3,268 4,742 4,927 5,743 5,266 5,447 5,535 5,544 5,523 5,474 5,401 5,306 5,188 114,608 share of PVs 7.11 % 29.91 % 62.98 %

Model parameter Valuation (m)

Derivation of WACC: Derivation of Beta: Present values 2031e 67,365

Terminal Value 114,608

Debt ratio 6.00 % Financial Strength 1.00 Financial liabilities 11,678

Cost of debt (after tax) 2.5 % Liquidity (share) 1.00 Pension liabilities 0

Market return 7.00 % Cyclicality 0.90 Hybrid capital 0

Risk free rate 1.50 % Transparency 1.10 Minority interest 45

Others 1.00 Market val. of investments 0

Liquidity 1,075 No. of shares (m) 1,190.0

WACC 6.73 % Beta 1.00 Equity Value 171,325 Value per share (EUR) 143.97

Sensitivity Value per Share (EUR)

Terminal Growth Delta EBIT-margin

Beta WACC 1.25 % 1.50 % 1.75 % 2.00 % 2.25 % 2.50 % 2.75 % Beta WACC -1.5 pp -1.0 pp -0.5 pp +0.0 pp +0.5 pp +1.0 pp +1.5 pp

1.19 7.7 % 107.34 109.86 112.60 115.57 118.81 122.37 126.28 1.19 7.7 % 109.08 111.24 113.41 115.57 117.73 119.89 122.05

1.10 7.2 % 118.06 121.20 124.63 128.39 132.52 137.10 142.18 1.10 7.2 % 121.27 123.65 126.02 128.39 130.76 133.13 135.50

1.05 7.0 % 124.13 127.66 131.53 135.78 140.49 145.72 151.56 1.05 7.0 % 128.31 130.80 133.29 135.78 138.27 140.77 143.26

1.00 6.7 % 130.78 134.76 139.13 143.97 149.35 155.36 162.13 1.00 6.7 % 136.09 138.72 141.35 143.97 146.60 149.22 151.85

0.95 6.5 % 138.08 142.58 147.56 153.09 159.27 166.24 174.13 0.95 6.5 % 144.77 147.54 150.31 153.09 155.86 158.64 161.41

0.90 6.2 % 146.13 151.24 156.93 163.30 170.46 178.58 187.88 0.90 6.2 % 154.48 157.42 160.36 163.30 166.24 169.18 172.12

0.81 5.7 % 164.97 171.70 179.28 187.88 197.71 209.07 222.33 0.81 5.7 % 177.86 181.20 184.54 187.88 191.22 194.56 197.90

� Increasing proportion of maintenance revenues raises visibility.

� Jand contributes to increasing margins.

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Free Cash Flow Value Potential Warburg Research's valuation tool "FCF Value Potential" reflects the ability of the company to generate sustainable free cash flows. It is based on the "FCF potential" - a FCF "ex growth" figure - which assumes unchanged working capital and pure maintenance capex. A value indication is derived via the perpetuity of a given year’s “FCF potential” with consideration of the weighted costs of capital. The fluctuating value indications over time add a timing element to the DCF model (our preferred valuation tool). in EUR m 2015 2016 2017 2018 2019e 2020e 2021e

Net Income before minorities 3,062 3,618 4,055 4,088 3,353 4,820 5,833

+ Depreciation + Amortisation 1,289 1,268 1,277 1,362 1,764 1,810 1,420

- Net Interest Income -5 -38 185 -47 0 20 20

- Maintenance Capex 319 473 612 729 550 555 560

+ Other 0 0 0 0 0 0 0

= Free Cash Flow Potential 4,038 4,452 4,536 4,768 4,567 6,055 6,673

FCF Potential Yield (on market EV) 4.8 % 4.8 % 4.1 % 4.1 % 2.9 % 4.0 % 4.6 %

WACC 6.73 % 6.73 % 6.73 % 6.73 % 6.73 % 6.73 % 6.73 %

= Enterprise Value (EV) 83,685 92,032 111,078 115,328 154,916 150,310 144,901 = Fair Enterprise Value 60,019 66,174 67,422 70,879 67,896 90,016 99,198

- Net Debt (Cash) 2,603 2,603 2,603 2,603 7,889 3,302 -2,106

- Pension Liabilities 0 0 0 0 122 103 103

- Other 0 0 0 0 0 0 0

- Market value of minorities 0 0 0 0 0 0 0

+ Market value of investments 0 0 0 0 0 0 0

= Fair Market Capitalisation 57,416 63,571 64,819 68,276 59,885 86,611 101,201

Number of shares, average 1,197 1,194 1,194 1,194 1,194 1,194 1,194

= Fair value per share (EUR) 47.97 53.24 54.29 57.18 50.15 72.54 84.76

premium (-) / discount (+) in % -58.1 % -39.3 % -29.1 %

Sensitivity Fair value per Share (EUR)

9.73 % 32.69 36.27 37.00 39.00 32.73 49.45 59.33

8.73 % 36.69 40.68 41.49 43.72 37.25 55.45 65.94

7.73 % 41.72 46.22 47.14 49.67 42.94 62.99 74.25

WACC 6.73 % 48.25 53.42 54.47 57.37 50.32 72.78 85.04

5.73 % 57.06 63.13 64.36 67.77 60.29 85.99 99.60

4.73 % 69.59 76.95 78.44 82.58 74.46 104.79 120.31

3.73 % 88.85 98.18 100.08 105.32 96.25 133.67 152.14

� The FCF-value does not present an adequate picture of SAP's growth.

� The capex requirement is very low.

� FCF-Value-CAGR 2015-2021e: 10%.

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Valuation

2015 2016 2017 2018 2019e 2020e 2021e Price / Book 3.3 x 3.4 x 4.3 x 3.9 x 6.5 x 5.7 x 4.9 x

Book value per share ex intangibles -3.01 -0.59 1.03 1.53 -2.72 0.52 4.74

EV / Sales 4.0 x 4.2 x 4.7 x 4.7 x 5.6 x 5.1 x 4.6 x

EV / EBITDA 15.1 x 14.4 x 18.1 x 16.3 x 26.1 x 19.0 x 15.6 x

EV / EBIT 19.7 x 18.0 x 22.8 x 20.2 x 34.0 x 23.1 x 18.4 x

EV / EBIT adj.* 13.2 x 13.9 x 16.4 x 16.1 x 18.9 x 16.8 x 14.3 x

P / FCF 26.3 x 24.4 x 29.0 x 39.6 x 34.6 x 23.2 x 20.4 x

P / E 25.4 x 24.5 x 27.3 x 27.6 x 42.6 x 29.6 x 24.5 x

P / E adj.* 17.3 x 19.1 x 20.6 x 21.7 x 23.3 x 21.6 x 19.1 x

Dividend Yield 1.8 % 1.7 % 1.5 % 1.6 % 1.4 % 1.5 % 1.7 %

FCF Potential Yield (on market EV) 4.8 % 4.8 % 4.1 % 4.1 % 2.9 % 4.0 % 4.6 %

*Adjustments made for: Deferred rev. write-down, disc. activities, stock-based comp., acquisition-rel. charges, restructuring

Company Specific Items

2015 2016 2017 2018 2019e 2020e 2021e

Recurring 12,380 13,564 14,677 15,974 18,659 20,884 23,383 Recurring in % 59.5 % 61.5 % 62.6 % 64.7 % 67.4 % 70.8 % 73.8 % Cloud subscript. and support 2,286 2,993 3,769 4,993 7,059 9,052 11,314 Software licenses 4,838 4,860 4,872 4,647 4,561 4,193 3,942 Software support 10,094 10,571 10,908 10,981 11,600 11,832 12,069 Services 3,580 3,638 3,911 4,086 4,454 4,409 4,365

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Consolidated profit and loss In EUR m 2015 2016 2017 2018 2019e 2020e 2021e

Sales 20,798 22,062 23,460 24,707 27,674 29,486 31,690

Change Sales yoy 18.4 % 6.1 % 6.3 % 5.3 % 12.0 % 6.5 % 7.5 % COGS 6,618 6,570 7,052 7,460 8,568 8,628 8,924

Gross profit 14,180 15,492 16,408 17,247 19,106 20,858 22,766

Gross margin 68.2 % 70.2 % 69.9 % 69.8 % 69.0 % 70.7 % 71.8 %

Research and development 2,855 3,041 3,352 3,625 4,096 4,393 4,722

Sales and marketing 5,403 6,294 6,924 6,780 7,749 8,020 8,239

Administration expenses 1,052 1,005 1,075 1,099 1,591 1,150 1,204

Other operating expenses 621 32 181 39 1,120 774 706

Other operating income 3 0 0 0 0 0 0

Unfrequent items 0 0 0 0 0 0 0

EBITDA 5,541 6,388 6,153 7,066 5,930 7,931 9,315

Margin 26.6 % 29.0 % 26.2 % 28.6 % 21.4 % 26.9 % 29.4 %

Depreciation of fixed assets 312 315 315 392 400 420 430

EBITA 5,229 6,073 5,838 6,674 5,530 7,511 8,885

Amortisation of intangible assets 977 953 962 970 980 990 990

Goodwill amortisation 0 0 0 0 0 0 0

EBIT 4,252 5,120 4,876 5,704 4,550 6,521 7,895

Margin 20.4 % 23.2 % 20.8 % 23.1 % 16.4 % 22.1 % 24.9 %

EBIT adj. 6,346 6,629 6,770 7,164 8,180 8,943 10,104

Interest income 241 230 463 371 200 200 200

Interest expenses 246 268 278 418 200 180 180

Other financial income (loss) 0 0 0 0 0 0 0

EBT 3,991 4,848 5,025 5,601 4,550 6,541 7,915

Margin 19.2 % 22.0 % 21.4 % 22.7 % 16.4 % 22.2 % 25.0 %

Total taxes 929 1,230 970 1,513 1,197 1,720 2,082

Net income from continuing operations 3,062 3,618 4,055 4,088 3,353 4,820 5,833

Income from discontinued operations (net of tax) 0 0 0 0 0 0 0

Net income before minorities 3,062 3,618 4,055 4,088 3,353 4,820 5,833

Minority interest -8 0 38 6 0 0 0

Net income 3,070 3,618 4,017 4,082 3,353 4,820 5,833

Margin 14.8 % 16.4 % 17.1 % 16.5 % 12.1 % 16.3 % 18.4 % Number of shares, average 1,197 1,194 1,194 1,194 1,194 1,194 1,194

EPS 2.56 3.03 3.36 3.42 2.81 4.04 4.89

EPS adj. 3.77 3.89 4.45 4.35 5.14 5.53 6.25

*Adjustments made for: Deferred rev. write-down, disc. activities, stock-based comp., acquisition-rel. charges, restructuring

Guidance: 2019: Cl.&Sw.: 8.5-10% acc.; adj EBIT: EUR 7.85-8.05bn acc.

Financial Ratios 2015 2016 2017 2018 2019e 2020e 2021e

Total Operating Costs / Sales 47.7 % 47.0 % 49.2 % 46.7 % 52.6 % 48.6 % 46.9 %

Operating Leverage -0.1 x 3.4 x -0.8 x 3.2 x -1.7 x 6.6 x 2.8 x

EBITDA / Interest expenses 22.5 x 23.8 x 22.1 x 16.9 x 29.7 x 44.1 x 51.7 x

Tax rate (EBT) 23.3 % 25.4 % 19.3 % 27.0 % 26.3 % 26.3 % 26.3 %

Dividend Payout Ratio 45.0 % 41.3 % 41.2 % 43.8 % 58.7 % 43.3 % 40.9 %

Sales per Employee 275,763 271,698 268,664 262,476 561,930 n.a. n.a.

Sales, EBITDA in EUR m


Operating Performance in %


Performance per Share


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Consolidated balance sheet In EUR m 2015 2016 2017 2018 2019e 2020e 2021e

Assets

Goodwill and other intangible assets 26,969 27,097 24,241 26,952 26,029 25,092 24,155

thereof other intangible assets 984 490 -328 3,227 2,304 1,367 430

thereof Goodwill 22,689 23,311 21,274 23,725 23,725 23,725 23,725

Property, plant and equipment 2,195 2,580 2,967 3,553 3,869 4,159 4,849

Financial assets 1,336 1,358 1,155 1,536 1,536 1,536 1,536

Other long-term assets 0 0 0 0 0 0 0

Fixed assets 30,500 31,035 28,363 32,041 31,434 30,787 30,540

Inventories 0 0 0 0 0 0 0

Accounts receivable 5,375 6,100 6,017 6,502 7,203 7,675 8,248

Liquid assets 3,770 4,826 5,001 9,075 1,736 5,823 10,231

Other short-term assets 1,748 2,393 3,197 4,069 2,133 2,034 2,034

Current assets 10,893 13,319 14,215 19,646 11,071 15,531 20,513

Total Assets 41,393 44,354 42,578 51,687 42,505 46,318 51,053

Liabilities and shareholders' equity

Subscribed capital 1,229 1,229 1,229 1,229 1,229 1,229 1,229

Capital reserve 558 599 570 543 543 543 543

Retained earnings 20,049 22,302 24,794 27,407 28,975 31,832 35,581

Other equity components 1,437 2,247 -1,083 -347 -8,061 -7,870 -7,370

Shareholders' equity 23,273 26,377 25,510 28,832 22,686 25,734 29,983

Minority interest 28 21 31 45 45 45 45

Total equity 23,301 26,398 25,541 28,877 22,731 25,779 30,028

Provisions 1,119 1,094 1,084 1,585 1,766 1,757 1,757

thereof provisions for pensions and similar obligations 0 0 0 0 122 103 103

Financial liabilities (total) 9,522 8,294 6,595 11,678 9,625 9,125 8,125

thereof short-term financial liabilities 841 1,813 1,561 1,125 1,125 1,125 1,125

Accounts payable 1,192 1,417 1,270 1,630 1,516 1,616 1,736

Other liabilities 6,259 7,151 8,088 7,917 6,866 8,041 9,407

Liabilities 18,092 17,956 17,037 22,810 19,774 20,539 21,025

Total liabilities and shareholders' equity 41,393 44,354 42,578 51,687 42,505 46,318 51,053


Efficiency of Capital Employment

Operating Assets Turnover 3.3 x 3.0 x 3.0 x 2.9 x 2.9 x 2.9 x 2.8 x

Capital Employed Turnover 0.7 x 0.7 x 0.9 x 0.8 x 0.9 x 1.0 x 1.1 x

ROA 10.1 % 11.7 % 14.2 % 12.7 % 10.7 % 15.7 % 19.1 %

Return on Capital

ROCE (NOPAT) 11.6 % 13.0 % 13.8 % 14.2 % 10.8 % 16.0 % 20.3 %

ROE 14.4 % 14.6 % 15.5 % 15.0 % 13.0 % 19.9 % 20.9 %

Adj. ROE 21.1 % 18.7 % 20.5 % 19.1 % 23.8 % 27.3 % 26.8 %

Balance sheet quality

Net Debt 5,752 3,468 1,594 2,603 8,011 3,405 -2,003

Net Financial Debt 5,752 3,468 1,594 2,603 7,889 3,302 -2,106

Net Gearing 24.7 % 13.1 % 6.2 % 9.0 % 35.2 % 13.2 % -6.7 %

Net Fin. Debt / EBITDA 103.8 % 54.3 % 25.9 % 36.8 % 133.0 % 41.6 % n.a.

Book Value / Share 18.9 21.5 20.8 23.5 18.5 20.9 24.4

Book value per share ex intangibles -3.0 -0.6 1.0 1.5 -2.7 0.5 4.7

ROCE Development


Net debt in EUR m


Book Value per Share in EUR


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Consolidated cash flow statement In EUR m 2015 2016 2017 2018 2019e 2020e 2021e

Net income 3,070 3,618 4,055 4,088 3,353 4,820 5,833

Depreciation of fixed assets 312 315 315 392 784 820 430

Amortisation of goodwill 0 0 0 0 0 0 0

Amortisation of intangible assets 977 953 962 970 980 990 990

Increase/decrease in long-term provisions 0 0 0 0 122 -19 0

Other non-cash income and expenses -514 -230 -730 -306 0 0 0

Cash Flow before NWC change 3,845 4,656 4,602 5,144 5,239 6,611 7,253

Increase / decrease in inventory 0 0 0 0 0 0 0

Increase / decrease in accounts receivable -857 -725 -309 114 -701 -472 -574

Increase / decrease in accounts payable 759 0 389 195 -114 99 121

Increase / decrease in other working capital positions -99 696 363 -1,151 846 1,075 1,365

Increase / decrease in working capital (total) -197 -29 443 -842 32 702 912

Net cash provided by operating activities [1] 3,648 4,627 5,045 4,302 5,272 7,314 8,165

Investments in intangible assets -53 -56 -52 0 -57 -53 -53

Investments in property, plant and equipment -637 -945 -1,223 -1,458 -1,100 -1,110 -1,120

Payments for acquisitions 236 -106 -291 -1,665 -8,000 0 0

Financial investments -9 -756 358 0 0 0 0

Income from asset disposals 68 63 97 57 0 0 0

Net cash provided by investing activities [2] -395 -1,800 -1,111 -3,066 -9,157 -1,163 -1,173

Change in financial liabilities -2,104 -1,357 -1,364 4,961 -2,053 -500 -1,000

Dividends paid -1,316 -1,378 -1,499 -1,671 -1,785 -1,964 -2,084

Purchase of own shares 0 0 -500 0 0 0 0

Capital measures 64 27 0 0 0 0 0

Other 0 3 -45 -4 0 0 0

Net cash provided by financing activities [3] -3,356 -2,705 -3,408 3,286 -3,454 -2,064 -2,584

Change in liquid funds [1]+[2]+[3] -103 122 526 4,522 -7,339 4,087 4,408

Effects of exchange-rate changes on cash 134 167 -218 95 0 0 0

Cash and cash equivalent at end of period 3,359 3,700 4,010 8,628 1,288 5,371 9,808


Cash Flow

FCF 2,958 3,626 3,770 2,844 4,115 6,151 6,992

Free Cash Flow / Sales 14.2 % 16.4 % 16.1 % 11.5 % 14.9 % 20.9 % 22.1 %

Free Cash Flow Potential 4,038 4,452 4,536 4,768 4,567 6,055 6,673

Free Cash Flow / Net Profit 96.4 % 100.2 % 93.9 % 69.7 % 122.7 % 127.6 % 119.9 %

Interest Received / Avg. Cash 6.2 % 5.4 % 9.4 % 5.3 % 3.7 % 5.3 % 2.5 %

Interest Paid / Avg. Debt 2.3 % 3.0 % 3.7 % 4.6 % 1.9 % 1.9 % 2.1 %

Management of Funds

Investment ratio 3.3 % 4.5 % 5.4 % 5.9 % 4.2 % 3.9 % 3.7 %

Maint. Capex / Sales 1.5 % 2.1 % 2.6 % 3.0 % 2.0 % 1.9 % 1.8 %

Capex / Dep 53.5 % 78.9 % 99.8 % 107.0 % 83.8 % 82.5 % 82.6 %

Avg. Working Capital / Sales 18.1 % 20.1 % 20.1 % 19.5 % 19.1 % 19.9 % 19.8 %

Trade Debtors / Trade Creditors 450.9 % 430.5 % 473.8 % 398.9 % 475.0 % 475.0 % 475.0 %

Inventory Turnover n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Receivables collection period (days) 94 101 94 96 95 95 95

Payables payment period (days) 66 79 66 80 65 68 71

Cash conversion cycle (Days) n.a. n.a. n.a. n.a. n.a. n.a. n.a.

CAPEX and Cash Flow in EUR m


Free Cash Flow Generation


Working Capital


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The valuation underlying the investment recommendation for the company analysed here is based on generally accepted and widely used methods of

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SOURCES

All data and consensus estimates have been obtained from FactSet except where stated otherwise.

http://www.mmwarburg.de/disclaimer/disclaimer.htm#Valuation

SAP

NO T E Publ ished 19 .11 .2019 17

RESEARCH

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Company Disclosure Link to the historical price targets and rating changes (last 12 months)

SAP 6 http://www.mmwarburg.com/disclaimer/disclaimer_en/DE0007164600.htm

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SAP

NO T E Publ ished 19 .11 .2019 18

RESEARCH

INVESTMENT RECOMMENDATION

Investment recommendation: expected direction of the share price development of the financial instrument up to the given price target in the opinion of

the analyst who covers this financial instrument.

-B- Buy: The price of the analysed financial instrument is expected to rise over the next 12 months.

-H- Hold: The price of the analysed financial instrument is expected to remain mostly flat over the next 12

months.

-S- Sell: The price of the analysed financial instrument is expected to fall over the next 12 months.

“-“ Rating suspended: The available information currently does not permit an evaluation of the company.

WARBURG RESEARCH GMBH – ANALYSED RESEARCH UNIVERSE BY RATING

Rating Number of stocks % of Universe

Buy 118 58

Hold 74 37

Sell 6 3

Rating suspended 4 2

Total 202 100

WARBURG RESEARCH GMBH – ANALYSED RESEARCH UNIVERSE BY RATING N

N taking into account only those companies which were provided with major investment services in the last twelve months.

Rating Number of stocks % of Universe

Buy 32 74

Hold 9 21

Sell 0 0

Rating suspended 2 5

Total 43 100

PRICE AND RATING HISTORY SAP AS OF 19.12.2019

Markings in the chart show rating changes by Warburg Research

GmbH in the last 12 months. Every marking details the date and

closing price on the day of the rating change.

SAP

NO T E Publ ished 19 .11 .2019 19

RESEARCH

EQUITIES Matthias Rode +49 40 3282-2678 Head of Equities [email protected] RESEARCH Michael Heider +49 40 309537-280 Andreas Pläsier +49 40 309537-246 Head of Research [email protected] Banks, Financial Services [email protected]

Henner Rüschmeier +49 40 309537-270 Franz Schall +49 40 309537-230 Head of Research [email protected] Automobiles, Car Suppliers [email protected]

Jan Bauer +49 40 309537-155 Malte Schaumann +49 40 309537-170 Renewables [email protected] Technology [email protected]

Jonas Blum +49 40 309537-240 Patrick Schmidt +49 40 309537-125 Telco, Construction [email protected] Leisure, Internet [email protected]

Christian Cohrs +49 40 309537-175 Oliver Schwarz +49 40 309537-250 Industrials & Transportation [email protected] Chemicals, Agriculture [email protected]

Felix Ellmann +49 40 309537-120 Cansu Tatar +49 40 309537-248 Software, IT [email protected] Cap. Goods, Engineering [email protected]

Jörg Philipp Frey +49 40 309537-258 Marc-René Tonn +49 40 309537-259 Retail, Consumer Goods [email protected] Automobiles, Car Suppliers [email protected]

Marius Fuhrberg +49 40 309537-185 Robert-Jan van der Horst +49 40 309537-290 Financial Services [email protected] Technology [email protected]

Ulrich Huwald +49 40 309537-255 Andreas Wolf +49 40 309537-140 Health Care, Pharma [email protected] Software, IT [email protected]

Philipp Kaiser +49 40 309537-260 Real Estate [email protected]

Thilo Kleibauer +49 40 309537-257 Retail, Consumer Goods [email protected]

Eggert Kuls +49 40 309537-256 Engineering [email protected]

INSTITUTIONAL EQUITY SALES Marc Niemann +49 40 3282-2660 Matthias Fritsch +49 40 3282-2696 Head of Equity Sales, Germany [email protected] United Kingdom [email protected]

Klaus Schilling +49 40 3282-2664 Tobias Hald +49 40 3282-2695 Head of Equity Sales, Germany [email protected] United Kingdom [email protected]

Tim Beckmann +49 40 3282-2665 Christopher Seedorf +49 69 5050-7414 United Kingdom [email protected] Switzerland [email protected]

Lyubka Bogdanova +49 69 5050-7411 Ireland, Poland, Australia [email protected]

Jens Buchmüller +49 69 5050-7415 Sophie Hauer +49 69 5050-7417 Scandinavia, Austria [email protected] Roadshow/Marketing [email protected]

Alexander Eschweiler +49 40 3282-2669 Juliane Niemann +49 40 3282-2694 Germany [email protected] Roadshow/Marketing [email protected]

SALES TRADING Oliver Merckel +49 40 3282-2634 Bastian Quast +49 40 3282-2701 Head of Sales Trading [email protected] Sales Trading [email protected] Elyaz Dust +49 40 3282-2702 Jörg Treptow +49 40 3282-2658 Sales Trading [email protected] Sales Trading [email protected] Michael Ilgenstein +49 40 3282-2700 Jan Walter +49 40 3282-2662 Sales Trading [email protected] Sales Trading [email protected] MACRO RESEARCH Carsten Klude +49 40 3282-2572 Dr. Christian Jasperneite +49 40 3282-2439 Macro Research [email protected] Investment Strategy [email protected] Our research can be found under: Warburg Research http://research.mmwarburg.com/en/index.html Thomson Reuters www.thomsonreuters.com Bloomberg MMWA GO Capital IQ www.capitaliq.com FactSet www.factset.com For access please contact:

Andrea Schaper +49 40 3282-2632 Kerstin Muthig +49 40 3282-2703 Sales Assistance [email protected] Sales Assistance [email protected]

mailto:[email protected]






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