DAYFORCE INC (DAY.CA) Stock Fundamental Analysis

Canada - Toronto Stock Exchange - TSX:DAY - US15677J1088 - Common Stock

95.19 CAD

-0.43 (-0.45%)

Last: 1/23/2026, 7:00:00 PM

Fundamental Rating

Taking everything into account, DAY scores 4 out of 10 in our fundamental rating. DAY was compared to 6 industry peers in the Professional Services industry. There are concerns on the financial health of DAY while its profitability can be described as average. DAY is quite expensive at the moment. It does show a decent growth rate.

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1. Profitability

1.1 Basic Checks

DAY had positive earnings in the past year.
In the past year DAY had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: DAY reported negative net income in multiple years.
DAY had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

DAY has a Return On Assets (-1.72%) which is in line with its industry peers.
With a Return On Equity value of -5.55%, DAY perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 2.19%, DAY is in line with its industry, outperforming 50.00% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	-1.72%
ROE	-5.55%
ROIC	2.19%

ROA(3y)-0.02%

ROA(5y)-0.23%

ROE(3y)-0.16%

ROE(5y)-0.81%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

DAY's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 7.41%, DAY is doing good in the industry, outperforming 66.67% of the companies in the same industry.
In the last couple of years the Operating Margin of DAY has remained more or less at the same level.
DAY has a better Gross Margin (49.77%) than 83.33% of its industry peers.
DAY's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	7.41%
PM (TTM)	N/A
GM	49.77%

OM growth 3YN/A

OM growth 5Y0.19%

PM growth 3YN/A

PM growth 5Y-35.96%

GM growth 3Y7.32%

GM growth 5Y0.65%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DAY is destroying value.
Compared to 1 year ago, DAY has more shares outstanding
DAY has more shares outstanding than it did 5 years ago.
The debt/assets ratio for DAY has been reduced compared to a year ago.

2.2 Solvency

Based on the Altman-Z score of 1.32, we must say that DAY is in the distress zone and has some risk of bankruptcy.
DAY has a Altman-Z score of 1.32. This is comparable to the rest of the industry: DAY outperforms 50.00% of its industry peers.
The Debt to FCF ratio of DAY is 7.33, which is on the high side as it means it would take DAY, 7.33 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of DAY (7.33) is comparable to the rest of the industry.
DAY has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
DAY has a Debt to Equity ratio of 0.23. This is in the lower half of the industry: DAY underperforms 66.67% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.23
Debt/FCF	7.33
Altman-Z	1.32

ROIC/WACC0.26

WACC8.39%

2.3 Liquidity

DAY has a Current Ratio of 1.04. This is a normal value and indicates that DAY is financially healthy and should not expect problems in meeting its short term obligations.
DAY has a Current ratio (1.04) which is in line with its industry peers.
A Quick Ratio of 1.04 indicates that DAY should not have too much problems paying its short term obligations.
DAY has a Quick ratio of 1.04. This is comparable to the rest of the industry: DAY outperforms 50.00% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.04
Quick Ratio	1.04

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

DAY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.89%, which is quite good.
DAY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 34.49% yearly.
DAY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.73%.
The Revenue has been growing by 16.39% on average over the past years. This is quite good.

EPS 1Y (TTM)14.89%

EPS 3Y96.74%

EPS 5Y34.49%

EPS Q2Q%-21.28%

Revenue 1Y (TTM)11.73%

Revenue growth 3Y19.78%

Revenue growth 5Y16.39%

Sales Q2Q%9.45%

3.2 Future

Based on estimates for the next years, DAY will show a small growth in Earnings Per Share. The EPS will grow by 3.60% on average per year.
DAY is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.74% yearly.

EPS Next Y14.74%

EPS Next 2Y17.84%

EPS Next 3Y18.2%

EPS Next 5Y3.6%

Revenue Next Year11.03%

Revenue Next 2Y11.19%

Revenue Next 3Y11.28%

Revenue Next 5Y9.74%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 31.94 indicates a quite expensive valuation of DAY.
The rest of the industry has a similar Price/Earnings ratio as DAY.
DAY's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.21.
Based on the Price/Forward Earnings ratio of 25.06, the valuation of DAY can be described as expensive.
DAY's Price/Forward Earnings ratio is rather cheap when compared to the industry. DAY is cheaper than 83.33% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.26. DAY is around the same levels.

		Industry Rank	Sector Rank
PE	31.94
Fwd PE	25.06

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as DAY.
DAY's Price/Free Cash Flow is on the same level as the industry average.

		Industry Rank	Sector Rank
P/FCF	66.59
EV/EBITDA	33.36

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as DAY's earnings are expected to grow with 18.20% in the coming years.