SAP vs Teradata Which Outperforms?

SAP and Teradata are two prominent companies in the tech industry, known for their innovative solutions in data management and analytics. While both companies have seen success in the market, their performance in terms of stocks has varied over time. SAP, a global leader in enterprise software, has a strong track record of growth and resilience in the stock market. On the other hand, Teradata, a specialist in data warehousing, has faced challenges in recent years, causing fluctuations in its stock performance. Let's explore the factors contributing to the contrasting fortunes of SAP and Teradata in the stock market.

SAP or Teradata?

When comparing SAP and Teradata, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between SAP and Teradata.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. SAP has a dividend yield of 0.97%, while Teradata has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. SAP reports a 5-year dividend growth of 6.69% year and a payout ratio of 90.44%. On the other hand, Teradata reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with SAP P/E ratio at 99.14 and Teradata's P/E ratio at 37.85. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. SAP P/B ratio is 6.82 while Teradata's P/B ratio is 24.83.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, SAP has seen a 5-year revenue growth of -0.21%, while Teradata's is 0.01%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with SAP's ROE at 6.71% and Teradata's ROE at 84.54%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $251.53 for SAP and $32.08 for Teradata. Over the past year, SAP's prices ranged from $148.38 to $256.13, with a yearly change of 72.62%. Teradata's prices fluctuated between $24.02 and $49.44, with a yearly change of 105.83%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.