SAP SE, the renowned German software company headquartered in Walldorf, has overtaken Novo Nordisk to claim the title of Europe’s most valuable public company. SAP’s shares have appreciated by 40% over the past year, and a more than 1% increase in early trading in Frankfurt pushed its market capitalisation to roughly €312bn.
In contrast, Novo Nordisk, known globally for its weight-loss drug Wegovy, has seen its share price decline by over 2% recently, reducing its market value to just above €309bn. The Danish drugmaker’s shares have lost nearly half their value since last summer, despite a 25% rise in revenue for 2024. The recent study results for its next-generation weight-loss drug, CagriSema, were disappointing as they failed to demonstrate superior efficacy compared to existing treatments, further eroding investor confidence.
SAP’s impressive performance has been driven by its strategic shift towards subscription-based cloud services, enhanced with additional AI features a move that has boosted revenue prospects and earned a positive outlook from investors. JPMorgan analysts have reiterated their “Overweight” rating on SAP’s shares, describing them as an attractive buying opportunity with a price target of €300.
This development marks a significant milestone in the European market, highlighting the diverging fortunes of two industry leaders one from the tech sector and the other from pharmaceuticals. As SAP continues to expand its digital offerings, Novo Nordisk now faces the challenge of regaining market confidence amid a highly competitive landscape.
