Market's view on Sage Group
Published on April 2024
- Stock watchers indicated that an article from The Fool lacked detailed insights and had inaccuracies, questioning the overall quality of the analysis. Concerns were raised about the claimed dividend yield being misleadingly high.
- Sentiments were shared about brokers generally being outpaced by Sage’s performance, highlighting a discrepancy between broker share price targets and actual market prices.
- Discussions included observations on Sage’s strong Q1 trading update for FY24, noting strong ARR growth and expected margins increase, driven by new customer acquisition and increases in cloud revenue.
- Positive reactions were noted towards Sage’s resilience in share price, with significant increases post-results and continued broker upgrades.
- Comments criticised the reliability of analysts, mentioning a particular instance where Société Générale upgraded Sage from ‘sell’ to ‘hold’, questioning the timing and rationale behind such shifts in rating.
- Reference was made to Sage’s transformation outcomes highlighted in excellent financial results, showcasing strong revenue growth, margin improvement, and successful product adoption rates.
- Stock watchers discussed the potential undervaluation of Sage in comparison to similar companies, suggesting that Sage might be an attractive target for a buyout given its valuation gap.
- There was speculation about the changing perceptions of Sage, transitioning from an old-school software provider to a modern SaaS business, and how this rebranding might positively impact its stock value.
- Observations were shared on the market’s response to Sage’s financial results and strategic updates, with a general consensus that the market is beginning to recognise Sage’s growth and transformation efforts.