DESCARTES SYSTEMS GRP/THE (DSGX)
CA2499061083 - Common Stock
DSGX gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 280 industry peers in the Software industry. DSGX scores excellent points on both the profitability and health parts. This is a solid base for a good stock. DSGX has a correct valuation and a medium growth rate. With these ratings, DSGX could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
DSGX had positive earnings in the past year.
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 has a better Return On Assets (8.16%) than 83.87% of its industry peers.
DSGX's Return On Equity of 9.74% is fine compared to the rest of the industry. DSGX outperforms 78.85% of its industry peers.
DSGX has a Return On Invested Capital of 8.64%. This is amongst the best in the industry. DSGX outperforms 83.15% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DSGX is below the industry average of 12.22%.
The 3 year average ROIC (8.30%) for DSGX is below the current ROIC(8.64%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.16% | ||
| ROE | 9.74% | ||
| ROIC | 8.64% |
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 has a better Profit Margin (21.03%) than 88.89% of its industry peers.
DSGX's Profit Margin has improved in the last couple of years.
DSGX has a Operating Margin of 25.29%. This is amongst the best in the industry. DSGX outperforms 91.76% of its industry peers.
In the last couple of years the Operating Margin of DSGX has grown nicely.
DSGX's Gross Margin of 75.91% is fine compared to the rest of the industry. DSGX outperforms 69.89% of its industry peers.
DSGX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.29% | ||
| PM (TTM) | 21.03% | ||
| GM | 75.91% |
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.
DSGX has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 24.49 indicates that DSGX is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 24.49, DSGX belongs to the top of the industry, outperforming 92.83% of the companies in the same industry.
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 | 24.49 |
ROIC/WACC0.82
WACC10.6%
2.3 Liquidity
A Current Ratio of 1.79 indicates that DSGX should not have too much problems paying its short term obligations.
The Current ratio of DSGX (1.79) is comparable to the rest of the industry.
A Quick Ratio of 1.79 indicates that DSGX should not have too much problems paying its short term obligations.
DSGX has a Quick ratio (1.79) which is comparable to the rest of the industry.
DSGX does not score too well on the current and quick ratio evaluation. However, as it has 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 | 1.79 | ||
| Quick Ratio | 1.79 |
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.
The Earnings Per Share has been growing by 30.06% on average over the past years. This is a very strong growth
EPS 1Y (TTM)21.37%
EPS 3Y16.96%
EPS 5Y30.06%
EPS Q2Q%35.48%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%16.63%
3.2 Future
DSGX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.95% yearly.
DSGX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.92% yearly.
EPS Next Y26.93%
EPS Next 2Y31.9%
EPS Next 3Y29.37%
EPS Next 5Y22.95%
Revenue Next Year11.07%
Revenue Next 2Y12.55%
Revenue Next 3Y11.12%
Revenue Next 5Y10.92%
3.3 Evolution
Although the future EPS 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 72.79, DSGX can be considered very expensive at the moment.
DSGX's Price/Earnings ratio is in line with the industry average.
DSGX's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.54.
The Price/Forward Earnings ratio is 56.99, which means the current valuation is very expensive for 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 23.99. DSGX is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 72.79 | ||
| Fwd PE | 56.99 |
4.2 Price Multiples
69.89% of the companies in the same industry are more expensive than DSGX, based on the Enterprise Value to EBITDA ratio.
65.95% of the companies in the same industry are more expensive than DSGX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 49.53 | ||
| EV/EBITDA | 43.4 |
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 29.37% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.7
PEG (5Y)2.42
EPS Next 2Y31.9%
EPS Next 3Y29.37%
5. Dividend
5.1 Amount
DSGX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
DESCARTES SYSTEMS GRP/THE
NASDAQ:DSGX (12/24/2024, 8:07:06 PM)
Premarket: 115 -0.73 (-0.63%)115.73
+1.05 (+0.92%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners87.2%
Inst Owner Change3.1%
Ins Owners0.27%
Ins Owner ChangeN/A
Market Cap9.89B
Analysts75
Price Target76.38 (-34%)
Short Float %0.64%
Short Ratio2.89
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/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)0.53%
Min EPS beat(2)-0.16%
Max EPS beat(2)1.22%
EPS beat(4)2
Avg EPS beat(4)-2.16%
Min EPS beat(4)-9.73%
Max EPS beat(4)1.22%
EPS beat(8)5
Avg EPS beat(8)1.78%
EPS beat(12)7
Avg EPS beat(12)1.24%
EPS beat(16)11
Avg EPS beat(16)4.9%
Revenue beat(2)1
Avg Revenue beat(2)-0.05%
Min Revenue beat(2)-1.11%
Max Revenue beat(2)1%
Revenue beat(4)2
Avg Revenue beat(4)-0.05%
Min Revenue beat(4)-2.04%
Max Revenue beat(4)1.94%
Revenue beat(8)5
Avg Revenue beat(8)-0.15%
Revenue beat(12)9
Avg Revenue beat(12)0.59%
Revenue beat(16)13
Avg Revenue beat(16)1.23%
PT rev (1m)-2.18%
PT rev (3m)5.81%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.18%
EPS NY rev (1m)1.91%
EPS NY rev (3m)5.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)4.91%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)4.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 72.79 | ||
| Fwd PE | 56.99 | ||
| P/S | 16.28 | ||
| P/FCF | 49.53 | ||
| P/OCF | 48.19 | ||
| P/B | 7.54 | ||
| P/tB | 62.64 | ||
| EV/EBITDA | 43.4 |
EPS(TTM)1.59
EY1.37%
EPS(NY)2.03
Fwd EY1.75%
FCF(TTM)2.34
FCFY2.02%
OCF(TTM)2.4
OCFY2.07%
SpS7.11
BVpS15.35
TBVpS1.85
PEG (NY)2.7
PEG (5Y)2.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.16% | ||
| ROE | 9.74% | ||
| ROCE | 11.29% | ||
| ROIC | 8.64% | ||
| ROICexc | 10.61% | ||
| ROICexgc | N/A | ||
| OM | 25.29% | ||
| PM (TTM) | 21.03% | ||
| GM | 75.91% | ||
| FCFM | 32.86% |
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-Score7
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 8.07% | ||
| Cap/Sales | 0.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 92.4% | ||
| Profit Quality | 156.27% | ||
| Current Ratio | 1.79 | ||
| Quick Ratio | 1.79 | ||
| Altman-Z | 24.49 |
F-Score7
WACC10.6%
ROIC/WACC0.82
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 3Y16.96%
EPS 5Y30.06%
EPS Q2Q%35.48%
EPS Next Y26.93%
EPS Next 2Y31.9%
EPS Next 3Y29.37%
EPS Next 5Y22.95%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%16.63%
Revenue Next Year11.07%
Revenue Next 2Y12.55%
Revenue Next 3Y11.12%
Revenue Next 5Y10.92%
EBIT growth 1Y6.21%
EBIT growth 3Y25.69%
EBIT growth 5Y26%
EBIT Next Year97.22%
EBIT Next 3Y37.65%
EBIT Next 5Y26.82%
FCF growth 1Y14.74%
FCF growth 3Y16.63%
FCF growth 5Y22.62%
OCF growth 1Y14.21%
OCF growth 3Y16.54%
OCF growth 5Y21.6%