SAP downgraded to "sell"

08.10.08 - LB Baden-Württemberg

LONDON, October 8 (newratings.com) - Analysts at LB Baden-Württemberg downgrade SAP AG (SAP) from "hold" to "sell," while reducing their estimates for the company. The target price has been reduced from ?41 to ?25.

In a research note published this morning, the analysts mention that the company has reported its 3Q software revenues substantially short of the estimates. Customer uncertainty is unlikely to improve significantly in the rest of 2008, which is expected to adversely impact SAP?s performance in 4Q, the analysts say. The economic expectations for 2009 have been reduced recently and the company is likely to be affected by economic deterioration, LB Baden-Württemberg adds. The EPS estimates for 2008 and 2009 have been reduced from ?1.69 to ?1.36 and from ?2.11 to ?1.49, respectively.