After the drop, is SAP stock an opportunity again?Like the major players in the software sector, SAP shares have corrected sharply on the stock market since spring 2025. The major stocks in this sector are facing unfavorable capital arbitrage as flows are shifting toward the AI sector. Historically pure and already very mature software companies have therefore seen capital outflows as investors reposition into stocks fully exposed to AI growth. However, software companies such as Adobe or SAP remain highly profitable and are starting to implement solid strategies to monetize AI.
Last week, I reviewed the case of Adobe stock. Today, I am asking the same question for SAP shares: after a 45% drop in a few months, should one consider repositioning on the buy side for SAP stock?
Financial market technical analysis and fundamental valuation analysis suggest that caution and patience are still warranted:
• The real tangible support zone is rather located between €130 and €150 per share
• From a valuation standpoint, SAP’s drop is not yet a fundamental opportunity in the same way as Adobe
From a technical perspective, SAP’s monthly chart shows that the €170 area has now become an intermediate resistance, corresponding to a former support that has turned into a distribution zone. The stock experienced a very rapid bullish acceleration before correcting sharply, which often leaves room for prolonged consolidation phases. In this type of setup, it is common for the market to test deeper retracement areas before considering a sustainable recovery. The technical levels between €130 and €150 correspond to previous congestion zones and more credible Fibonacci retracement levels to build a medium-term entry point with a better risk/reward ratio.
From a fundamental standpoint, valuation remains demanding despite the correction. By comparison, Adobe is trading at significantly lower earnings multiples, while its growth momentum remains solid and its cash generation capacity is comparable. For its part, SAP retains a strong strategic positioning in enterprise software, with a captive customer base and recurring revenues, but the market is already pricing in a good portion of the future benefits linked to the integration of AI into its solutions. In other words, SAP’s valuation premium remains partly justified by its quality, but it mechanically limits short-term re-rating potential.
Finally, in a context of sector rotation that remains favorable to stocks directly exposed to AI, large “historical” software names continue to suffer from a relative attractiveness deficit compared with tech giants such as Microsoft. For a long-term investor, SAP remains a high-quality name to watch closely, but entry discipline is essential. A gradual, step-by-step approach on lower technical zones would allow repositioning with a greater margin of safety, rather than trying to catch an uncertain bottom.
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