SAP: Q2 13 results a bit below expectations, modest FY13 guidance revision
BUY, Fair Value EUR73 (+27%)
This morning SAP reported Q2 13 Product (SSRS) sales roughly in line with our forecast and 1% behind the consensus, and an op. margin 0.8ppt above our projection but 0.2ppt below consensus. Total revenues are 2% below consensus, and licence sales were down 3% at cc – we expected -2% and consensus was an est. +3%. The bad news is that SAP shaved FY13 SSRS revenue guidance to “at least +10%” from “between 11% and 13%” due to the difficult economic environment in Asia Pacific and the transition to Cloud, but we deem the 10% share price decline since Sapphire Now already priced in these fears, and the non-IFRS op. profit guidance (EUR5.85-5.95bn at cc) was reiterated. We expect a slight negative share price reaction near term before a potential rebound.
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