We recently compiled a list of the Top 10 AI News Updates This Weekend. In this article, we are going to take a look at where SAP SE (NYSE:SAP) stands against the other AI stocks.
According to JP Morgan, the S&P will propel to new heights this New Year, and artificial intelligence is one of the reasons why. Besides AI, Strategist Dubravko Lakos-Bujas pointed to a resilient economy and the possibility of easier industry regulations as reasons for the boost, setting 6,500 as his 2025 target for the broad market index.
The U.S. will remain “the global growth engine with the business cycle in expansion, a healthy labor market, broadening of AI-related capital spending, and prospect of stronger capital market and deal activity”.
– Lakos-Bujas.
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US equities have already enjoyed a strong 2024, up 26% year to date due to enthusiasm around AI and a resilient economy. A tighter labor market, record wealth, and “potentially lower energy prices” are also reasons to celebrate. Investors have been happy about Donald Trump’s win as well, noted Lakos-Bujas, fueling their expectations of lower taxes and deregulation across industries.
“Heightened geopolitical uncertainty and the evolving policy agenda are introducing unusual complexity to the outlook, but opportunities are likely to outweigh risks. The benefit of deregulation and a more business-friendly environment are likely underestimated along with potential for unlocking productivity gains and capital deployment”.
In other news, artificial intelligence is stepping in to keep the Thanksgiving cheer alive, making sure holiday staples stay abundant and affordable for years to come.
“Cranberry production is challenging … [and] growers are really concerned about heat stress events”.
– Dr. Jeffrey Neyhart
Artificial intelligence is helping by speeding up the process of identifying heat-resistant varieties for cranberries. Researchers like Dr. Neyhart are using AI to save years of work and improve crop resilience in the face of climate change.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A data centre room with cloud technology, illustrating the enterprise application software services.
SAP SE (NYSE:SAP)
Number of Hedge Fund Holders: 36
SAP SE (NYSE:SAP), a market leader in ERP software, leverages AI to enhance its enterprise resource planning (ERP) solutions.
On November 28, Stifel Nicolaus analyst Chandramouli Sriraman maintained a “Buy” rating on SAP SE (NYSE:SAP) and set a price target of €245.00. The buy rating comes from SAP SE’s robust growth prospects in its Cloud business, with projected mid-20s growth in Cloud revenue driven by the conversion of a large maintenance base, potentially adding over €25 billion in revenue. Moreover, SAP’s strategic initiatives, including the adoption of Business Technology Platform (BTP), RISE with SAP, and Cloud ERP Suite, are expected to boost cross-selling opportunities. Meanwhile, new AI tools from the company are further expected to bolster growth. These reasons, coupled with improving Cloud gross margins and economies of scale, justify the buy rating.
Overall SAP ranks 9th on our list of the trending AI stocks this weekend. While we acknowledge the potential of SAP as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SAP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
