Why the quality investor may take a look at SPS COMMERCE INC (NASDAQ:SPSC).

Quality investors are looking for the best of the best. Companies which are growing steadily and consistently, but are also in excellent financial condition. We will have a look here to see if SPS COMMERCE INC (NASDAQ:SPSC) is suited for quality investing. Investors should of couse do their own research, but we spotted SPS COMMERCE INC showing up in our Caviar Cruise quality screen, so it may be worth spending some more time on it.

Why NASDAQ:SPSC may be interesting for quality investors.

• SPS COMMERCE INC has achieved substantial revenue growth over the past 5 years, with a 15.42% increase. This signifies the company's ability to successfully capture market opportunities and generate sustained revenue growth.
• SPS COMMERCE INC exhibits a strong ROIC excluding cash and goodwill, indicating efficient capital utilization and profitable operations. The 79.74% reflects the company's ability to generate returns on invested capital and underscores its commitment to delivering value to shareholders.
• SPS COMMERCE INC maintains a healthy Debt/Free Cash Flow Ratio of 0.0, indicating a strong financial position and prudent debt management. This ratio suggests the company has sufficient free cash flow to cover its debt obligations and highlights its ability to generate cash from operations.
• The Profit Quality (5-year) of SPS COMMERCE INC stands at 172.0%, highlighting its ability to consistently generate reliable profits. This metric underscores the company's strong business fundamentals and reinforces its position as a financially stable entity.
• SPS COMMERCE INC has consistently achieved strong EBIT growth over the past 5 years, with a 48.07% increase. This underscores the company's effective management of its operating income and suggests a positive outlook for future profitability.
• With EBIT 5-year growth outpacing its Revenue 5-year growth, SPS COMMERCE INC showcases its effective cost management and enhanced operational performance. This suggests the company's ability to generate higher earnings from its revenue streams.

What else is there to say on the fundamentals of NASDAQ:SPSC?

At ChartMill, a crucial aspect of their analysis is the assignment of a Fundamental Rating to each stock. This rating, ranging from 0 to 10, is calculated daily by considering numerous fundamental indicators and properties.

SPSC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 286 industry peers in the Software industry. Both the health and profitability get an excellent rating, making SPSC a very profitable company, without any liquidiy or solvency issues. SPSC has a decent growth rate and is not valued too expensively. These ratings would make SPSC suitable for quality investing!

Check the latest full fundamental report of SPSC for a complete fundamental analysis.

More quality stocks can be found in our Caviar Cruise screen.

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.