Two days before it is due to report first-quarter earnings, shares of European software giant

SAP

(SAP) - Get Report

are continuing a two-week rally that has pushed share prices up 25%.

Tuesday, SAP gained $1.21 cents, or 5.2%, to $24.03 per share. The stock has added $5.07 a share since closing at $18.96 on March 31.

The strong upward move prompted analyst Jason Brueschke of Pacific Growth Equities to advise investors to sell ahead of Thursday's Q1 earnings report, which will be released before U.S. markets open. "The outlook for SAP remains decidedly negative near term," he wrote in a research note on Tuesday. "With the likelihood of a Q1 license miss still strong, we expect F03 estimates to come down after SAP reports." Pacific Growth Equities does not have a banking relationship with SAP.

Analysts polled by Thomson Financial/First Call expect SAP to earn 13 cents in the first quarter, compared with 9 cents a year ago, on revenue of $1.75 billion, 19% greater than the $1.4 billion posted in the same quarter in 2002.

Based in Germany, SAP is the largest enterprise-application software developer in the world. The company has long-dominated the market for complex, back-office applications, and is now

moving aggressively into the front-office space dominated by

Siebel Systems

(SEBL)

.

In a note markedly more bullish than Brueschke's, analyst Patrick Walravens of JMP Securities on Tuesday reiterated his market outperform rating on the stock, saying "SAP is gaining market and its installed base of 18,000 customers has a strong appetite for SAP's new products."

However, he also noted that he expects the company to post decreasing software revenue when it reports Thursday. Walravens said that his estimate of a 25% drop in quarterly revenue compares favorably to both

PeopleSoft

(PSFT)

and Siebel. JMP does not have a banking relationship with SAP.