Is NASDAQ:SPSC suited for quality investing?

In this article we will dive into SPS COMMERCE INC (NASDAQ:SPSC) as a possible candidate for quality investing. Investors should always do their own research, but we noticed SPS COMMERCE INC showing up in our Caviar Cruise quality screen, which makes it worth to investigate a bit more.

Why NASDAQ:SPSC may be interesting for quality investors.

• Over the past 5 years, SPS COMMERCE INC has experienced impressive revenue growth, with 15.42% increase. This demonstrates the company's ability to effectively expand its top line and suggests a positive outlook for future revenue generation.
• 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.
• With a favorable Debt/Free Cash Flow Ratio of 0.0, SPS COMMERCE INC showcases its sound financial discipline and cash flow management. This ratio indicates the company's ability to service its debt obligations while maintaining sufficient free cash flow for future investments or operational needs.
• With a favorable Profit Quality (5-year) ratio of 172.0%, SPS COMMERCE INC showcases its ability to consistently deliver high-quality profits. This metric signifies the company's financial strength and its capacity to generate sustainable earnings over an extended period.
• The 5-year EBIT growth of SPS COMMERCE INC has been remarkable, with 48.07% increase. This demonstrates the company's ability to improve its operational efficiency and indicates its competitiveness within the market.
• 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 is the full fundamental picture of NASDAQ:SPSC telling us.

Every day, ChartMill assigns a Fundamental Rating to each stock, providing a score ranging from 0 to 10. This rating is determined by evaluating various fundamental indicators and properties.

We assign a fundamental rating of 6 out of 10 to SPSC. SPSC was compared to 282 industry peers in the Software industry. SPSC gets an excellent profitability rating and is at the same time showing great financial health properties. SPSC is valied quite expensively at the moment, while it does show a decent growth rate. With these ratings, SPSC could be worth investigating further for quality investing!.

Our latest full fundamental report of SPSC contains the most current fundamental analsysis.

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.