Announcement • Dec 28
Software AG Reportedly Eyes Sale of Further Platforms After IBM Deal Software Aktiengesellschaft (XTRA:SOW) has invited competitors and investors to submit bids for two software platforms and is looking at options for a third one, the Handelsblatt daily reported on December 27, 2023, citing sources familiar with the talks. Software AG, which is majority-owned by private equity firm Silver Lake Technology Management, L.L.C., is looking for interested parties for its TrendMiner NV and Cumulocity GmbH platforms, according to Handelsblatt. In addition, options are being examined for its alfabet GmbH (Alfabet software), the report said. Trend Miner is used for data analysis for industry, Cumulocity is a software used for the 'Internet of Things' and Alfabet helps with the visualisation of company architecture. Software AG was not immediately available for comment. Announcement • Dec 18
Silver Lake Announces an Offer to Delist Software AG US IT services giant International Business Machines Corporation, or IBM, announced on December 18, 2023 a EUR 2.13 billion (USD 2.33 billion) deal to acquire two enterprise technology platforms from Software AG, a German software company majority owned by US private equity firm Silver Lake Technology Management, L.L.C. Software AG is currently majority owned by Silver Lake, which has recently acquired a 93.3% stake in a deal that valued the entire business at EUR 2.6 billion. Silver Lake also announced on December 18, 2023 an offer of EUR 32 per share to delist Software AG. Announcement • Oct 24
Silver Lake Technology Management, L.L.C. and Mosel Bidco SE acquired a 5% stake in Software Aktiengesellschaft. Silver Lake Technology Management, L.L.C. and Mosel Bidco SE acquired a 5% stake in Software Aktiengesellschaft on October 23, 2023. Silver Lake Technology Management, L.L.C. and Mosel Bidco SE completed the acquisition of a 5% stake in Software Aktiengesellschaft on October 23, 2023. Announcement • Sep 25
Software Aktiengesellschaft(XTRA:SOW) dropped from S&P Global BMI Index Software Aktiengesellschaft(XTRA:SOW) dropped from S&P Global BMI Index Announcement • Jul 22
Silver Lake Continues to Intend to Pursue A Delisting of Software AG Silver Lake together with Mosel Bidco SE, a holding company controlled by funds managed or advised by Silver Lake ("Silver Lake"), announced the final results of the Additional Acceptance Period whereby it has secured a total stake of 84.29 % of shares in Software Aktiengesellschaft as of 17 July 2023. This excludes bonds convertible into Software AG shares held by Silver Lake. Subject to regulatory approval by the relevant investment-control authorities, closing of the transaction is expected in fourth quarter 2023. Christian Lucas, Co-head EMEA at Silver Lake, said: "We are pleased to have reached such a successful outcome for our tender offer made to Software AG shareholders. We look forward to working with the management team to execute the company's multi-year transformation plan." Silver Lake reiterates that it does not require a domination and profit and loss transfer agreement (DPLTA) to finance its offer or achieve its economic and strategic objectives. After closing of the tender offer, Silver Lake continues to intend to pursue a delisting of Software AG to support management with implementation of its strategy in a non-listed environment, and with the backing of Silver Lake as Software AG's new majority shareholder. Announcement • Jul 18
Software Aktiengesellschaft to Report First Half, 2023 Results on Aug 11, 2023 Software Aktiengesellschaft announced that they will report first half, 2023 results on Aug 11, 2023 Announcement • Jun 15
Silver Lake Confirms its Plan to Pursue Delisting of Software AG After Closing the Offer Silver Lake Technology Management, L.L.C. has waived the minimum acceptance threshold of 50% plus one share in its EUR 2.4 billion (USD 2.59 billion) tender offer for German enterprise software developer Software AG, while also extending the acceptance period. Silver Lake said on June 13, 2023 that it does not require majority control to finance the offer or to underpin its investment strategy. The US firm “is comfortable to support Software AG on its multi-year transformation journey in a private setting out of a substantial minority position,” it said. Silver Lake has already secured a stake of about 31% in Software AG, making it the new largest and anchor shareholder of the German company. The private equity firm confirmed its plan to pursue a delisting of Software AG after closing the offer. Because of the amended threshold condition, the acceptance period has been extended by two weeks until June 28, 2023. Announcement • Jun 14
Silver Lake to Likely Abandon Software AG Acceptance Threshold Silver Lake Technology Management, L.L.C. will likely drop the acceptance threshold for its contentious EUR 2.4 Billion acquisition bid for Software AG (Software Aktiengesellschaft), Bloomberg's Eyk Henning, Aaron Kirchfeld, and Jan-Henrik-Foerster report, citing people with knowledge of the matter. The private equity firm is leaning towards abandoning a condition that its offer win support from investors owning just over 50% of the German company, the authors say. Upcoming Dividend • May 11
Upcoming dividend of €0.05 per share at 0.1% yield Eligible shareholders must have bought the stock before 18 May 2023. Payment date: 22 May 2023. Payout ratio is a comfortable 19% but the company is paying out more than the cash it is generating. Trailing yield: 0.1%. Lower than top quartile of German dividend payers (4.7%). Lower than average of industry peers (1.6%). Price Target Changed • Apr 27
Price target increased by 9.8% to €26.81 Up from €24.41, the current price target is an average from 12 analysts. New target price is 12% below last closing price of €30.30. Stock is up 2.7% over the past year. The company is forecast to post earnings per share of €0.84 for next year compared to €0.26 last year. Price Target Changed • Apr 24
Price target increased by 8.6% to €26.81 Up from €24.69, the current price target is an average from 13 analysts. New target price is 9.9% below last closing price of €29.76. Stock is down 3.6% over the past year. The company is forecast to post earnings per share of €0.85 for next year compared to €0.26 last year. Reported Earnings • Mar 31
Full year 2022 earnings: Revenues exceed analysts expectations while EPS lags behind Full year 2022 results: EPS: €0.26 (down from €1.13 in FY 2021). Revenue: €958.2m (up 15% from FY 2021). Net income: €19.0m (down 77% from FY 2021). Profit margin: 2.0% (down from 10% in FY 2021). The decrease in margin was driven by higher expenses. Revenue exceeded analyst estimates by 1.7%. Earnings per share (EPS) missed analyst estimates by 73%. Revenue is forecast to grow 5.2% p.a. on average during the next 3 years, compared to a 7.2% growth forecast for the Software industry in Germany. Over the last 3 years on average, earnings per share has fallen by 37% per year but the company’s share price has only fallen by 10% per year, which means it has not declined as severely as earnings. Announcement • Feb 14
Software Aktiengesellschaft announced that it has received AUD 4.5 million in funding Software Aktiengesellschaft announced a private placement of 136,363,636 common shares at an issue price of AUD 0.033 per share for the gross proceeds of AUD 4.5 million on February 13, 2023. Major Estimate Revision • Feb 08
Consensus EPS estimates fall by 27% The consensus outlook for fiscal year 2023 has been updated. 2023 EPS estimate fell from €1.42 to €1.03 per share. Revenue forecast steady at €1.02b. Net income forecast to grow 303% next year vs 26% growth forecast for Software industry in Germany. Consensus price target down from €29.18 to €26.25. Share price fell 6.0% to €20.50 over the past week. Reported Earnings • Feb 05
Full year 2022 earnings: Revenues exceed analysts expectations while EPS lags behind Full year 2022 results: EPS: €0.26 (down from €1.13 in FY 2021). Revenue: €958.2m (up 15% from FY 2021). Net income: €19.0m (down 77% from FY 2021). Profit margin: 2.0% (down from 10% in FY 2021). The decrease in margin was driven by higher expenses. Revenue exceeded analyst estimates by 1.3%. Earnings per share (EPS) missed analyst estimates by 71%. Revenue is forecast to grow 4.8% p.a. on average during the next 3 years, compared to a 7.8% growth forecast for the Software industry in Germany. Over the last 3 years on average, earnings per share has fallen by 37% per year but the company’s share price has only fallen by 15% per year, which means it has not declined as severely as earnings. Price Target Changed • Feb 03
Price target decreased by 7.3% to €27.04 Down from €29.18, the current price target is an average from 14 analysts. New target price is 30% above last closing price of €20.80. Stock is down 38% over the past year. The company is forecast to post earnings per share of €0.90 for next year compared to €1.13 last year. Buying Opportunity • Feb 01
Now 23% undervalued The stock has been flat over the last 90 days. The fair value is estimated to be €28.29, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has been flat over the last 3 years. Earnings per share has declined by 31%. Revenue is forecast to grow by 21% in 2 years. Earnings is forecast to grow by 167% in the next 2 years. Announcement • Feb 01
Software Aktiengesellschaft to Report Fiscal Year 2022 Final Results on Mar 28, 2023 Software Aktiengesellschaft announced that they will report fiscal year 2022 final results on Mar 28, 2023 Announcement • Jan 25
Software AG Announces Results of New Global Survey of over 2,000 Senior It Decision-Makers from the U.S., Canada, U.K., Germany and France Software AG announced the results of a new global survey of over 2,000 senior IT decision-makers from the U.S., Canada, U.K., Germany and France. It finds that the majority (84%) of organizations will prioritize commercial objectives over sustainability in the face of economic challenges. This is despite the fact that almost all (95%) leaders agree sustainability is either a top or high priority and a similar number (97%) agree that other firms' sustainability credentials are either essential or important in their own buying decisions. The annual Reality Check report seeks to investigate how technology initiatives can benefit both sustainability and commercial objectives. Despite the difficulties of delivering sustainability initiatives, 87% of companies believe that they will lose investors if they don't have a clear strategy and many lack the technology to deliver one. In almost a third (32%) of cases the necessary technology is simply not in place. And even when it is available, it is poorly implemented or used by almost half (47%) of companies. In particular, 36% say that they are unable to effectively track the progress of sustainability initiatives to determine whether they are effective. The majority (87%) of organizations tackle sustainability and digital transformation separately. The Reality Check report shows how an integrated approach can address multiple challenges at once. Promisingly, a third (33%) of organizations have already integrated sustainability plans into their technology roadmap. Price Target Changed • Oct 14
Price target decreased to €30.29 Down from €32.71, the current price target is an average from 14 analysts. New target price is 45% above last closing price of €20.82. Stock is down 50% over the past year. The company is forecast to post earnings per share of €1.14 for next year compared to €1.13 last year. Announcement • Sep 30
Software Aktiengesellschaft to Report Q4, 2022 Results on Feb 01, 2023 Software Aktiengesellschaft announced that they will report Q4, 2022 results on Feb 01, 2023 Reported Earnings • Jul 31
Second quarter 2022 earnings: EPS misses analyst expectations Second quarter 2022 results: EPS: €0.24 (down from €0.45 in 2Q 2021). Revenue: €226.9m (up 4.0% from 2Q 2021). Net income: €17.5m (down 47% from 2Q 2021). Profit margin: 7.7% (down from 15% in 2Q 2021). The decrease in margin was driven by higher expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 100%. Over the next year, revenue is forecast to grow 11%, compared to a 7.8% growth forecast for the industry in Germany. Over the last 3 years on average, earnings per share has fallen by 27% per year but the company’s share price has increased by 1% per year, which means it is well ahead of earnings. Price Target Changed • Jul 20
Price target decreased to €34.23 Down from €37.23, the current price target is an average from 12 analysts. New target price is 23% above last closing price of €27.88. Stock is down 29% over the past year. The company is forecast to post earnings per share of €1.19 for next year compared to €1.13 last year. Upcoming Dividend • May 11
Upcoming dividend of €0.76 per share Eligible shareholders must have bought the stock before 18 May 2022. Payment date: 20 May 2022. Payout ratio is a comfortable 62% and this is well supported by cash flows. Trailing yield: 2.7%. Lower than top quartile of German dividend payers (4.3%). Higher than average of industry peers (2.0%). Reported Earnings • Apr 29
First quarter 2022 earnings: Revenues exceed analysts expectations while EPS lags behind First quarter 2022 results: EPS: €0.24 (up from €0.14 in 1Q 2021). Revenue: €206.0m (up 13% from 1Q 2021). Net income: €17.6m (up 73% from 1Q 2021). Profit margin: 8.6% (up from 5.6% in 1Q 2021). The increase in margin was driven by higher revenue. Revenue exceeded analyst estimates by 6.9%. Earnings per share (EPS) missed analyst estimates by 100%. Over the next year, revenue is forecast to grow 10%, compared to a 14% growth forecast for the industry in Germany. Over the last 3 years on average, earnings per share has fallen by 26% per year but the company’s share price has only fallen by 3% per year, which means it has not declined as severely as earnings. Valuation Update With 7 Day Price Move • Mar 08
Investor sentiment deteriorated over the past week After last week's 16% share price decline to €28.10, the stock trades at a forward P/E ratio of 19x. Average forward P/E is 28x in the Software industry in Germany. Total loss to shareholders of 6.6% over the past three years. Simply Wall St's valuation model estimates the intrinsic value at €50.46 per share. Buying Opportunity • Feb 04
Now 20% undervalued after recent price drop Over the last 90 days, the stock is down 7.3%. The fair value is estimated to be €41.95, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has declined by 2.7% per annum over the last 3 years. Earnings per share has declined by 25% per annum over the last 3 years. Reported Earnings • Jan 29
Full year 2021 earnings: EPS misses analyst expectations Full year 2021 results: EPS: €1.13 (down from €1.29 in FY 2020). Revenue: €833.8m (flat on FY 2020). Net income: €83.9m (down 12% from FY 2020). Profit margin: 10% (down from 12% in FY 2020). Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 2.2%. Over the next year, revenue is forecast to grow 7.0%, compared to a 13% growth forecast for the industry in Germany. Over the last 3 years on average, earnings per share has fallen by 25% per year but the company’s share price has remained flat, which means it is well ahead of earnings. Valuation Update With 7 Day Price Move • Dec 14
Investor sentiment deteriorated over the past week After last week's 16% share price decline to €33.44, the stock trades at a forward P/E ratio of 23x. Average forward P/E is 30x in the Software industry in Germany. Total returns to shareholders of 15% over the past three years. Reported Earnings • Oct 23
Third quarter 2021 earnings released: EPS €0.22 (vs €0.19 in 3Q 2020) The company reported a strong third quarter result with improved earnings, revenues and profit margins. Third quarter 2021 results: Revenue: €198.0m (up 6.8% from 3Q 2020). Net income: €16.3m (up 18% from 3Q 2020). Profit margin: 8.2% (up from 7.4% in 3Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has fallen by 22% per year but the company’s share price has only fallen by 1% per year, which means it has not declined as severely as earnings. Reported Earnings • Jul 23
Second quarter 2021 earnings released: EPS €0.45 (vs €0.29 in 2Q 2020) The company reported a strong second quarter result with improved earnings, revenues and profit margins. Second quarter 2021 results: Revenue: €218.2m (up 6.6% from 2Q 2020). Net income: €33.1m (up 53% from 2Q 2020). Profit margin: 15% (up from 11% in 2Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has fallen by 19% per year but the company’s share price has only fallen by 1% per year, which means it has not declined as severely as earnings. Upcoming Dividend • May 06
Upcoming dividend of €0.76 per share Eligible shareholders must have bought the stock before 13 May 2021. Payment date: 18 May 2021. Trailing yield: 2.1%. Lower than top quartile of German dividend payers (3.1%). Higher than average of industry peers (1.6%). Reported Earnings • Mar 25
Full year 2020 earnings released: EPS €1.29 (vs €2.10 in FY 2019) The company reported a poor full year result with weaker earnings, revenues and profit margins. Full year 2020 results: Revenue: €834.8m (down 6.3% from FY 2019). Net income: €95.7m (down 38% from FY 2019). Profit margin: 12% (down from 17% in FY 2019). Over the last 3 years on average, earnings per share has fallen by 8% per year whereas the company’s share price has fallen by 6% per year. Is New 90 Day High Low • Feb 22
New 90-day high: €37.42 The company is up 4.0% from its price of €35.94 on 24 November 2020. The German market is up 10.0% over the last 90 days, indicating the company underperformed over that time. It also underperformed the Software industry, which is up 8.0% over the same period. According to the Simply Wall St valuation model, the estimated intrinsic value of the company is €48.25 per share. Reported Earnings • Jan 28
Full year 2020 earnings released: EPS €1.29 (vs €2.10 in FY 2019) The company reported a poor full year result with weaker earnings, revenues and profit margins. Full year 2020 results: Revenue: €834.8m (down 6.3% from FY 2019). Net income: €95.7m (down 38% from FY 2019). Profit margin: 12% (down from 17% in FY 2019). Over the last 3 years on average, earnings per share has fallen by 8% per year and the company’s share price has also fallen by 8% per year. Analyst Estimate Surprise Post Earnings • Jan 28
Revenue beats expectations, earnings disappoint Revenue exceeded analyst estimates by 0.2%. Earnings per share (EPS) missed analyst estimates by 1.7%. Over the next year, revenue is forecast to stay flat compared to a 18% growth forecast for the Software industry in Germany.