Trefis Price of $48.14 vs. Market Price of $48.30
Trefis has just launched coverage of SAP which makes money by selling crucial information management software applications to businesses worldwide. 40% of the Trefis estimate for SAP’s stock comes from its Resource Planning Software which helps companies to use their business data to make more money.
SAP customers include banks like the Bank of Ireland, Barclays and Deutshce Postbank. Banks can use SAP’s Resource Planning Software (also known as ERP software) to enhance their customer experience and make more money using customer information to cross-sell new products to existing customers.
For example, the credit card and savings account systems within a bank are two unconnected systems that can be connected using SAP ERP software. Such a connection makes it easier for the bank’s customers to directly auto-debit their credit card payments to their savings accounts. By integrating the data from both systems, the bank can also more efficiently cross-sell credit cards to their savings account customers and vice-versa leading to new revenue opportunities.
SAP’s market share amongst banks and other customers within the $24 billion ERP software market is an important factor for the company’s stock. The company’s share has declined from 29% in 2005 to 26% today primarily due to innovative product improvements by competitors like Oracle, Infor, Sage and Microsoft. We expect that share will continue to decline to 24% by the end of the forecast period.
Within SAP’s content on our plaftorm, you can see how SAP’s stock will be impacted if the company loses significant Market Share in Resource Planning Software to Oracle, Infor, Sage and Microsoft.
