In 2024, SAP enjoyed an outstanding financial year. Under the leadership of CEO Christian Klein, the software giant has become the undisputed largest German company – now even twice as valuable as all leading carmakers combined. But this impressive growth also presents challenges: SAP is gradually becoming too large for the leading German index, the DAX.
Let's take a look at this outstanding stock. Our chart analysis.
At first glance, the chart looks as strong as the Visa (NYSE:V) stock chart: 
At second glance, we can already see the end of a very long upward movement, and thus a correction that is ideally suited for a purchase.
In detail, we see that the stock is at the end of a very long upward movement. The long-term target is the red box at €325.40 to €362.15. From there, a massive sell-off should start, pushing the stock down to the purple box at €170.28 to €72.88. This is the perfect time to buy the stock.
Alternatively, the stock could fall directly to around this zone. As soon as the price falls below €223.45, the high at €274.45 will have marked the end of the entire cycle. 
Successful transformation under Christian Klein
Christian Klein has radically transformed SAP in recent years. Four and a half years ago, in October 2020, the company was still struggling with the rejection of its medium-term targets – which led to a sharp drop in its share price and a turnaround image – but since then, its strategy has been completely transformed.
Klein's strategy was to expand SAP from a traditional software provider for business processes to a leading cloud service provider and pioneer in the field of artificial intelligence (AI). This realignment has given the share price a real boost: in the past year alone, SAP shares rose by around 75%, and since the beginning of 2025, they have already risen by over 10%. The Handelsblatt recently even named Christian Klein ‘Manager of the Year 2024’.
An IT giant with global appeal
The market capitalisation of SAP, based in Walldorf, is now around 300 billion euros, making the group the most expensive German company listed on the stock exchange. By way of comparison, SAP is worth twice as much as the four leading carmakers Mercedes-Benz, BMW (ETR:BMWG), Porsche (ETR:P911_p) and Volkswagen (ETR:VOWG_p) combined. Even Siemens (ETR:SIEGn) and Deutsche Telekom (ETR:DTEGn), which rank second and third in the DAX, only come close to SAP's value.
Dominik Asam, SAP's Chief Financial Officer, emphasises that this development not only reflects the company's success, but also the profound economic change that the IT industry has undergone in recent decades. While in the 1980s IBM (NYSE:IBM) was the only company in the top ten most valuable listed companies, today eight companies – including Tesla (NASDAQ:TSLA), which is basically an IT company – are among the market leaders.
Growth spurt through AI and strategic investments
SAP's success story has been further boosted by extensive investments in the field of artificial intelligence. The share price has also benefited from recent announcements, such as US President Donald Trump's plans to invest $500 billion in the expansion of data centres for AI. SAP itself is increasingly focusing on generative AI in its business areas – a trend from which the company is likely to continue to benefit in the future, similar to its American competitor Oracle (NYSE:ORCL).
The DAX dilemma: when size becomes a risk
But success also brings challenges: SAP's rapid growth has made the company a dominant factor in the DAX. Last year, SAP played a major role in the leading index exceeding the 20,000-point mark for the first time in its 36-year history – and shortly afterwards passing the 21,000-point mark.
A regulatory cap on the DAX ensures that individual stocks may not account for more than a certain proportion (initially 10%, later increased to 15%) of the index. Without this limit, investors would face cluster risks, and for risk reasons many funds are only allowed to weight a single company at a maximum of 10%. SAP currently has a weighting of around 16%, which can be problematic for fund companies.
International stock exchanges are also facing similar challenges: for example, in the Dutch index ASML (AS:ASML), the weighting of 20% has been capped at 15%, and in the Swiss leading index SMI, high weightings of companies such as Nestlé, Roche and Novartis (SIX:NOVN) are also leading to comparable problems. However, Dominik Asam points out that other criteria besides the capping limit play a role in the valuation of a company – which is why a change of SAP from the Frankfurt Stock Exchange is not planned in the foreseeable future.
Outlook: strong growth despite possible challenges
For the coming year, CEO Christian Klein expects currency-adjusted revenue growth of 11 to 13% in the cloud and software business and strong double-digit growth in operating profit, driven by the ongoing trend towards AI. Around 34,000 of SAP's 400,000 customers already use AI applications, and this trend is likely to intensify.
Disclaimer/Risk warning:
The information provided here is for informational purposes only and does not constitute a recommendation to buy or sell. It should not be understood as an explicit or implicit assurance of a particular price development of the financial instruments mentioned or as a call to action. The purchase of securities involves risks that may lead to the total loss of the capital invested. The information provided does not replace expert investment advice tailored to individual needs. No liability or guarantee is assumed, either explicitly or implicitly, for the timeliness, accuracy, appropriateness or completeness of the information provided, nor for any financial losses. These are expressly not financial analyses, but journalistic texts. Readers who make investment decisions or carry out transactions based on the information provided here do so entirely at their own risk. The authors may hold securities of the companies/securities/shares discussed at the time of publication and therefore a conflict of interest may exist.