SAP Shares (ETR:SAP) Bounce Off Lows: Has Support Stepped In?

SAP shares (ETR:SAP) have rebounded from recent lows today, with the stock finding support around the €200 level this week and rising approximately 2% to €206.10 during the morning session. This movement follows a 24% decline since the second half of last year, leading markets to question whether a corner has been turned.

The stock has experienced a volatile period, but the recent uptick suggests some renewed confidence. After a sustained period of selling pressure, the €200 mark appears to have acted as a psychological and technical floor for the shares.

The 2% gain today represents a tentative step in reversing the downward trend that has plagued SAP since the latter part of the previous year.

Several factors may be contributing to this potential shift in sentiment. SAP's strategic initiatives, such as the expansion of its Sovereign Cloud portfolio, are likely playing a role. This expansion, announced in September 2025, aims to bolster Europe's technological independence by providing customers with a comprehensive technology stack, including SAP Cloud Infrastructure and SAP Sovereign Cloud On-Site, emphasizing secure and compliant innovation. This move signals SAP's commitment to addressing regional needs and could be viewed favorably by markets seeking stability and growth in specific sectors.

However, challenges remain that could cap the potential upside. Just last month, SAP released a cumulative security update addressing 14 vulnerabilities across various products, including three critical-severity flaws. The most severe, CVE-2025-42880, is a code injection vulnerability in SAP Solution Manager ST 720, allowing authenticated attackers to execute malicious code remotely. While SAP addressed these issues promptly, the existence of such vulnerabilities underscores the ongoing need for vigilance and could weigh on market sentiment if similar incidents recur.

Additionally, SAP continues to navigate regulatory scrutiny. In November, SAP offered concessions to resolve an EU antitrust investigation concerning its on-premise Enterprise Resource Planning (ERP) support services. These proposed remedies, which allow customers to select from multiple support-service providers and eliminate certain fees, aim to address competition concerns. The outcome of this investigation and the potential impact of the concessions on SAP's revenue model remain a point of uncertainty for markets.

Recent institutional investment adjustments also provide a mixed signal. Federated Hermes Inc. decreased its holdings in SAP by 21.2% in December 2025, selling 11,057 shares during the second quarter. This adjustment reflects a broader trend of institutional investors reassessing their positions in the company. While not necessarily indicative of a negative long-term outlook, such adjustments can exert downward pressure on the stock in the short term.

The bounce off the €200 support level is an encouraging sign, but markets will need to see further evidence of a sustained turnaround before fully embracing a more bullish outlook. The combination of strategic initiatives and analyst upgrades has provided a temporary boost, but the long-term growth prospects and stock performance will depend on SAP's ability to execute its strategy effectively.