SAP SE (SAP): investment thesis checklist
What a value investor writing down why they own SAP SE would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 15.5% in FY2025; between 6.6% and 15.5% over 8 filed years, median 10.1%. Does the thesis need it to stay inside that range?
- Return on equity: 16.1% in FY2025; between 5.7% and 17.3% over 10 filed years, median 14.0%. Does the thesis need it to stay inside that range?
- Gross margin: 72.9% in FY2025; between 69.7% and 73.2% over 10 filed years, median 71.7%. Does the thesis need it to stay inside that range?
- Operating margin: 26.1% in FY2025; between 13.7% and 26.1% over 10 filed years, median 21.9%. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 6.1% in FY2025; between 4.1% and 9.4% over 10 filed years, median 5.9%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from SAP SE's own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Debt to Equity stays at or below 0.22x
Today 0.18x. Replayed over 8 filed years, it would have broken in 6; most recently FY2024, at 0.24x (20-F, filed 2025-02-27).
Revenue Growth 1Y stays at or above 0%
Today 7.68%. Replayed over 9 filed years, it would have broken in 2; most recently FY2021, at -1.41% (20-F, filed 2022-03-03).
Return on Invested Capital stays at or above 12.4%
Today 15.52%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which debt to equity rose above 0.22x.
- A filed year in which revenue growth 1y fell below 0%.
- A filed year in which return on invested capital fell below 12.4%.
4. The published tests it meets today
Of 30 tests value investors published: 2 met, 24 not met, 4 we could not complete. Counts, never a score.
Meets: High returns and growth; ROIC at or above WACC.
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
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How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.