SAP targets small businesses with new offering
With Business One, the company is providing a solution that bundles many functions into a single package.
The company has a majority share of the enterprise resource planning (ERP) software market, where it competes primarily with Microsoft (MSFT), Oracle (ORCL) and Salesforce.com (CRM). We expect its market share to decline marginally through the forecast period, due to increasing competition. (Microsoft owns and publishes Top Stocks, and MSN Money site.)
SAP focuses on its forte: ERP
SAP has traditionally focused on ERP offerings for enterprises, but has been looking at other markets to increase sales. It recently launched a new version of Business ByDesign -- an on-demand, cloud-based product -- in a bid to capitalize on the rapidly-expanding market for cloud software. Oracle and Microsoft have also launched cloud versions of their enterprise applications in the past year.
With Business One, SAP is focusing on small and medium-sized businesses with an easy-to-deploy solution that bundles resource planning, customer relationship software, inventory management, reporting, accounting and financial management in a single package.
With Business One, Business ByDesign, and its traditional ERP offering, SAP now offers ERP solutions in all forms and for any company size.
Enterprise resource planning software accounts for around 38% of our $63 Trefis price estimate for SAP, which stands nearly 2% above its current market price.
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The expected $3.36 billion offering from Citizens Financial Group won't come close to Alibaba's, but it will be an important one for the market.
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