We assign a fundamental rating of 6 out of 10 to AGYS. AGYS was compared to 278 industry peers in the Software industry. AGYS scores excellent on profitability, but there are some minor concerns on its financial health. AGYS is valued quite expensively, but it does show have an excellent growth rating. These ratings would make AGYS suitable for growth investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

AGYS had positive earnings in the past year.
AGYS had a positive operating cash flow in the past year.
Of the past 5 years AGYS 4 years were profitable.
Each year in the past 5 years AGYS had a positive operating cash flow.

1.2 Ratios

Looking at the Return On Assets, with a value of 5.72%, AGYS is in the better half of the industry, outperforming 73.74% of the companies in the same industry.
AGYS has a Return On Equity of 8.21%. This is in the better half of the industry: AGYS outperforms 71.22% of its industry peers.
With a decent Return On Invested Capital value of 7.97%, AGYS is doing good in the industry, outperforming 78.78% of the companies in the same industry.
AGYS had an Average Return On Invested Capital over the past 3 years of 7.16%. This is below the industry average of 10.74%.
The last Return On Invested Capital (7.97%) for AGYS is above the 3 year average (7.16%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	5.72%
ROE	8.21%
ROIC	7.97%

ROA(3y)11.61%

ROA(5y)4.91%

ROE(3y)17.82%

ROE(5y)7.29%

ROIC(3y)7.16%

ROIC(5y)N/A

1.3 Margins

AGYS's Profit Margin of 8.12% is fine compared to the rest of the industry. AGYS outperforms 68.35% of its industry peers.
In the last couple of years the Profit Margin of AGYS has grown nicely.
AGYS has a Operating Margin of 9.65%. This is in the better half of the industry: AGYS outperforms 74.46% of its industry peers.
In the last couple of years the Operating Margin of AGYS has grown nicely.
AGYS's Gross Margin of 61.76% is on the low side compared to the rest of the industry. AGYS is outperformed by 60.79% of its industry peers.
AGYS's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	9.65%
PM (TTM)	8.12%
GM	61.76%

OM growth 3Y22.98%

OM growth 5YN/A

PM growth 3Y43.88%

PM growth 5YN/A

GM growth 3Y-0.01%

GM growth 5Y4.37%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

AGYS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
AGYS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for AGYS has been increased compared to 5 years ago.
AGYS has a worse debt/assets ratio than last year.

2.2 Solvency

AGYS has an Altman-Z score of 15.63. This indicates that AGYS is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of AGYS (15.63) is better than 94.24% of its industry peers.
AGYS has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	15.63

ROIC/WACC0.72

WACC11.12%

2.3 Liquidity

A Current Ratio of 1.22 indicates that AGYS should not have too much problems paying its short term obligations.
AGYS has a worse Current ratio (1.22) than 64.75% of its industry peers.
A Quick Ratio of 1.14 indicates that AGYS should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.14, AGYS is not doing good in the industry: 67.63% of the companies in the same industry are doing better.

		Industry Rank	Sector Rank
Current Ratio	1.22
Quick Ratio	1.14

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 25.95% over the past year.
The Earnings Per Share has been growing by 47.96% on average over the past years. This is a very strong growth
AGYS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.77%.
Measured over the past years, AGYS shows a quite strong growth in Revenue. The Revenue has been growing by 11.38% on average per year.

EPS 1Y (TTM)25.95%

EPS 3Y23.91%

EPS 5Y47.96%

EPS Q2Q%17.65%

Revenue 1Y (TTM)17.77%

Revenue growth 3Y19.23%

Revenue growth 5Y11.38%

Sales Q2Q%16.14%

3.2 Future

AGYS is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 23.34% yearly.
AGYS is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 21.76% yearly.

EPS Next Y9.1%

EPS Next 2Y19.97%

EPS Next 3Y23.34%

EPS Next 5YN/A

Revenue Next Year16.41%

Revenue Next 2Y16.35%

Revenue Next 3Y20.21%

Revenue Next 5Y21.76%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

AGYS is valuated quite expensively with a Price/Earnings ratio of 65.23.
Compared to the rest of the industry, the Price/Earnings ratio of AGYS is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 27.21, AGYS is valued quite expensively.
A Price/Forward Earnings ratio of 47.93 indicates a quite expensive valuation of AGYS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AGYS is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of AGYS to the average of the S&P500 Index (25.98), we can say AGYS is valued expensively.

		Industry Rank	Sector Rank
PE	65.23
Fwd PE	47.93

4.2 Price Multiples

AGYS's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AGYS is on the same level as its industry peers.

		Industry Rank	Sector Rank
P/FCF	53.71
EV/EBITDA	75.57

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates AGYS does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of AGYS may justify a higher PE ratio.
A more expensive valuation may be justified as AGYS's earnings are expected to grow with 23.34% in the coming years.