Analyst: SAP Bid for Retail Software Good for i2, JDAS, DMAN

JMP Securities analyst Patrick Walravens this morning said enterprise software maker SAP AG’s (SAP) announcement yesterday it will acquire a small supply-chain software maker could be good news for DemandTec (DMAN), JDA Software (JDAS) and i2 Technologies (ITWO).

SAP said yesterday it will purchase SAF Simulation, Analysis and Forecasting AG, whose shares are traded on the XETRA Deutsche Borse, for Euros 11.50, a 10% premium to the company’s close on Friday. SAF’s software is able to model demand, apparently, to automate replenishment of retail outlets.

Walravens says the buy has no immediate impact on SAP, whose stock he rates “Market Underperform,” with a $25 price target. However, “In terms of lateral implications, the possibility that retail maybe willing to invest in supply chain solutions could be good news for companies like JDA Software, i2 Technologies, and

DemandTec. The fact that SAP was willing to pay over 4x revenue for this functionality is also a positive for these names, whichall trade at significantly lower multiples.”

Today, SAP shares are up 24 cents, or .6%, at $43.11, while shares of DemandTec are up 9 cents, or 1%, at $8.90; JDAS is up 26 cents, or 1.6%, at $16.27; and i2 is down 16 cents, or 1.3%, at $12.45.