Encouraging details in Q1 results, namely 34% jump in the number of Cloud deals SAP had already pre-announced Q1''21 so there were few surprises in the results announcement this week; however new disclosures on S4/HANA Revenue (EUR227m, +43% ccy in Q1) and S4/HANA Cloud Backlog (EUR1.04bn, +43% ccy in Q1) should offer greater visibility into the impact of RISE converting SAP''s customer base to the Cloud (even though Co. commented that 50% of additional S4/HANA customers in Q1 were net new), as well as into the general evolution of Cloud ERP adoption. As highlighted in our upgrade note this week, and part of our sector note (Hyperscalers and the Battle of Industry Clouds) and our Global Cloud Scanner Survey, we see ERP as the next major category to move to the Cloud, and SAP was named by 40% of respondents as their most likely strategic Cloud ERP provider. Cloud Backlog and Cloud deal cadence gives us confidence in H2''21 Cloud Revenue With Qualtrics now reporting as a public company and SAP''s additional disclosures on S/4HANA, we estimate SAP ''ex-Qualtrics'' delivered Current Cloud Backlog growth of 17% ccy in Q1. Group Current Backlog re-accelerated to 19% ccy having fallen to mid-teens level in H2''20. Together with a 34% jump in the number of Cloud deals signed in Q1, these data points should serve as leading indicators for future Cloud Revenues and give us confidence SAP can deliver ahead of market expectations on Cloud Revenues in H2''21, where we are 3-5% ahead of Consensus. Cloud execution would in turn unlock SAP''s valuation, currently trading at 16x EV/EBIT As a result of the re-basing of expectations in 2020 and concerns around the clarity of what RISE offers, SAP now trades on 16x FY22 Non-IFRS EV/EBIT, marginally above its 5-year median, while most software companies are trading well above historic averages as COVID is driving an acceleration in digital transformation. We believe that a successful migration of SAP''s large customer...