DESCARTES SYSTEMS GRP/THE (DSGX) Stock Fundamental Analysis
NASDAQ:DSGX - Nasdaq - CA2499061083 - Common Stock - Currency: USD
Taking everything into account, DSGX scores 7 out of 10 in our fundamental rating. DSGX was compared to 283 industry peers in the Software industry. DSGX gets an excellent profitability rating and is at the same time showing great financial health properties. DSGX is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! These ratings would make DSGX suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year DSGX was profitable.
In the past year DSGX had a positive cash flow from operations.
DSGX had positive earnings in 4 of the past 5 years.
Of the past 5 years DSGX 4 years had a positive operating cash flow.
1.2 Ratios
DSGX's Return On Assets of 8.51% is amongst the best of the industry. DSGX outperforms 84.06% of its industry peers.
DSGX's Return On Equity of 10.16% is fine compared to the rest of the industry. DSGX outperforms 79.35% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.11%, DSGX belongs to the top of the industry, outperforming 84.78% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for DSGX is below the industry average of 11.99%.
The 3 year average ROIC (8.30%) for DSGX is below the current ROIC(9.11%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.51% | ||
| ROE | 10.16% | ||
| ROIC | 9.11% |
ROA(3y)7.64%
ROA(5y)6.35%
ROE(3y)9.1%
ROE(5y)7.5%
ROIC(3y)8.3%
ROIC(5y)7.07%
1.3 Margins
DSGX's Profit Margin of 21.80% is amongst the best of the industry. DSGX outperforms 88.77% of its industry peers.
DSGX's Profit Margin has improved in the last couple of years.
DSGX has a better Operating Margin (26.37%) than 93.12% of its industry peers.
In the last couple of years the Operating Margin of DSGX has grown nicely.
DSGX's Gross Margin of 75.43% is fine compared to the rest of the industry. DSGX outperforms 68.12% of its industry peers.
DSGX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.37% | ||
| PM (TTM) | 21.8% | ||
| GM | 75.43% |
OM growth 3Y6.52%
OM growth 5Y8.82%
PM growth 3Y10.63%
PM growth 5Y12.21%
GM growth 3Y0.73%
GM growth 5Y0.84%
2. Health
2.1 Basic Checks
DSGX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
There is no outstanding debt for DSGX. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 24.21 indicates that DSGX is not in any danger for bankruptcy at the moment.
DSGX has a Altman-Z score of 24.21. This is amongst the best in the industry. DSGX outperforms 95.65% of its industry peers.
DSGX 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 | 24.21 |
ROIC/WACC0.72
WACC12.69%
2.3 Liquidity
A Current Ratio of 1.34 indicates that DSGX should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.34, DSGX is in line with its industry, outperforming 41.67% of the companies in the same industry.
A Quick Ratio of 1.34 indicates that DSGX should not have too much problems paying its short term obligations.
DSGX's Quick ratio of 1.34 is in line compared to the rest of the industry. DSGX outperforms 42.39% of its industry peers.
The current and quick ratio evaluation for DSGX is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
DSGX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.37%, which is quite impressive.
Measured over the past years, DSGX shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.35% on average per year.
Looking at the last year, DSGX shows a quite strong growth in Revenue. The Revenue has grown by 14.90% in the last year.
DSGX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.80% yearly.
EPS 1Y (TTM)21.37%
EPS 3Y30.71%
EPS 5Y27.35%
EPS Q2Q%35.48%
Revenue 1Y (TTM)14.9%
Revenue growth 3Y18%
Revenue growth 5Y15.8%
Sales Q2Q%16.62%
3.2 Future
Based on estimates for the next years, DSGX will show a very strong growth in Earnings Per Share. The EPS will grow by 24.26% on average per year.
DSGX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.40% yearly.
EPS Next Y27.15%
EPS Next 2Y23.44%
EPS Next 3Y27.6%
EPS Next 5Y24.26%
Revenue Next Year14.44%
Revenue Next 2Y12.92%
Revenue Next 3Y12.68%
Revenue Next 5Y11.4%
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 stable.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 71.73, DSGX can be considered very expensive at the moment.
DSGX's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of DSGX to the average of the S&P500 Index (29.19), we can say DSGX is valued expensively.
A Price/Forward Earnings ratio of 55.85 indicates a quite expensive valuation of DSGX.
DSGX's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 96.58. DSGX is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 71.73 | ||
| Fwd PE | 55.85 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DSGX is valued a bit cheaper than 71.01% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, DSGX is valued a bit cheaper than 64.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 47.79 | ||
| EV/EBITDA | 42 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of DSGX may justify a higher PE ratio.
DSGX's earnings are expected to grow with 27.60% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.64
PEG (5Y)2.62
EPS Next 2Y23.44%
EPS Next 3Y27.6%
5. Dividend
5.1 Amount
No dividends for DSGX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
DESCARTES SYSTEMS GRP/THE
NASDAQ:DSGX (2/12/2025, 8:07:12 PM)
After market: 114.05 0 (0%)114.05
-4.64 (-3.91%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners87.2%
Inst Owner Change-32.11%
Ins Owners0.27%
Ins Owner ChangeN/A
Market Cap9.75B
Analysts77.78
Price Target77.45 (-32.09%)
Short Float %0.61%
Short Ratio2.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.35%
Min EPS beat(2)-0.16%
Max EPS beat(2)2.86%
EPS beat(4)3
Avg EPS beat(4)0.99%
Min EPS beat(4)-0.16%
Max EPS beat(4)2.86%
EPS beat(8)5
Avg EPS beat(8)0.6%
EPS beat(12)7
Avg EPS beat(12)0.83%
EPS beat(16)11
Avg EPS beat(16)4.61%
Revenue beat(2)2
Avg Revenue beat(2)1.55%
Min Revenue beat(2)1%
Max Revenue beat(2)2.1%
Revenue beat(4)3
Avg Revenue beat(4)0.98%
Min Revenue beat(4)-1.11%
Max Revenue beat(4)2.1%
Revenue beat(8)6
Avg Revenue beat(8)0.34%
Revenue beat(12)9
Avg Revenue beat(12)0.72%
Revenue beat(16)13
Avg Revenue beat(16)1.32%
PT rev (1m)-0.04%
PT rev (3m)-0.81%
EPS NQ rev (1m)-2.1%
EPS NQ rev (3m)-6.13%
EPS NY rev (1m)0.08%
EPS NY rev (3m)2%
Revenue NQ rev (1m)2.5%
Revenue NQ rev (3m)4.26%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 71.73 | ||
| Fwd PE | 55.85 | ||
| P/S | 15.43 | ||
| P/FCF | 47.79 | ||
| P/OCF | 46.57 | ||
| P/B | 7.19 | ||
| P/tB | 126.56 | ||
| EV/EBITDA | 42 |
EPS(TTM)1.59
EY1.39%
EPS(NY)2.04
Fwd EY1.79%
FCF(TTM)2.39
FCFY2.09%
OCF(TTM)2.45
OCFY2.15%
SpS7.39
BVpS15.87
TBVpS0.9
PEG (NY)2.64
PEG (5Y)2.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.51% | ||
| ROE | 10.16% | ||
| ROCE | 11.9% | ||
| ROIC | 9.11% | ||
| ROICexc | 10.46% | ||
| ROICexgc | N/A | ||
| OM | 26.37% | ||
| PM (TTM) | 21.8% | ||
| GM | 75.43% | ||
| FCFM | 32.28% |
ROA(3y)7.64%
ROA(5y)6.35%
ROE(3y)9.1%
ROE(5y)7.5%
ROIC(3y)8.3%
ROIC(5y)7.07%
ROICexc(3y)10.84%
ROICexc(5y)8.83%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)10.85%
ROCE(5y)9.24%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y19.94%
ROICexc growth 5Y13.19%
OM growth 3Y6.52%
OM growth 5Y8.82%
PM growth 3Y10.63%
PM growth 5Y12.21%
GM growth 3Y0.73%
GM growth 5Y0.84%
F-Score6
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 7.61% | ||
| Cap/Sales | 0.85% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 88.25% | ||
| Profit Quality | 148.06% | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 | ||
| Altman-Z | 24.21 |
F-Score6
WACC12.69%
ROIC/WACC0.72
Cap/Depr(3y)8.41%
Cap/Depr(5y)7.87%
Cap/Sales(3y)1.12%
Cap/Sales(5y)1.19%
Profit Quality(3y)185.06%
Profit Quality(5y)213.67%
High Growth Momentum
Growth
EPS 1Y (TTM)21.37%
EPS 3Y30.71%
EPS 5Y27.35%
EPS Q2Q%35.48%
EPS Next Y27.15%
EPS Next 2Y23.44%
EPS Next 3Y27.6%
EPS Next 5Y24.26%
Revenue 1Y (TTM)14.9%
Revenue growth 3Y18%
Revenue growth 5Y15.8%
Sales Q2Q%16.62%
Revenue Next Year14.44%
Revenue Next 2Y12.92%
Revenue Next 3Y12.68%
Revenue Next 5Y11.4%
EBIT growth 1Y17.47%
EBIT growth 3Y25.69%
EBIT growth 5Y26%
EBIT Next Year97.22%
EBIT Next 3Y37.65%
EBIT Next 5Y27.97%
FCF growth 1Y12.14%
FCF growth 3Y16.63%
FCF growth 5Y22.62%
OCF growth 1Y11.77%
OCF growth 3Y16.54%
OCF growth 5Y21.6%