DESCARTES SYSTEMS GRP/THE (DSGX) Stock Fundamental Analysis
USA - NASDAQ:DSGX - CA2499061083 - Common Stock
82.4 USD
-0.97 (-1.16%)
DSGX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 281 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 not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make DSGX suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year DSGX was profitable.
DSGX had a positive operating cash flow in the past year.
In the past 5 years DSGX has always been profitable.
Each year in the past 5 years DSGX had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.46%, DSGX belongs to the top of the industry, outperforming 81.14% of the companies in the same industry.
DSGX's Return On Equity of 9.91% is fine compared to the rest of the industry. DSGX outperforms 75.44% of its industry peers.
The Return On Invested Capital of DSGX (9.19%) is better than 82.56% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DSGX is below the industry average of 12.07%.
The 3 year average ROIC (8.86%) for DSGX is below the current ROIC(9.19%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.46% | ||
| ROE | 9.91% | ||
| ROIC | 9.19% |
ROA(3y)8.11%
ROA(5y)7.3%
ROE(3y)9.67%
ROE(5y)8.67%
ROIC(3y)8.86%
ROIC(5y)7.93%
1.3 Margins
Looking at the Profit Margin, with a value of 21.70%, DSGX belongs to the top of the industry, outperforming 86.48% of the companies in the same industry.
In the last couple of years the Profit Margin of DSGX has grown nicely.
The Operating Margin of DSGX (27.36%) is better than 90.75% of its industry peers.
In the last couple of years the Operating Margin of DSGX has grown nicely.
DSGX's Gross Margin of 76.06% is fine compared to the rest of the industry. DSGX outperforms 70.82% of its industry peers.
DSGX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.36% | ||
| PM (TTM) | 21.7% | ||
| GM | 76.06% |
OM growth 3Y3.87%
OM growth 5Y11.08%
PM growth 3Y2.7%
PM growth 5Y14.15%
GM growth 3Y-0.17%
GM growth 5Y0.52%
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.
The number of shares outstanding for DSGX has been increased compared to 1 year ago.
The number of shares outstanding for DSGX has been increased compared to 5 years ago.
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 17.98 indicates that DSGX is not in any danger for bankruptcy at the moment.
DSGX has a Altman-Z score of 17.98. This is amongst the best in the industry. DSGX outperforms 94.31% 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 | 17.98 |
ROIC/WACC0.9
WACC10.2%
2.3 Liquidity
DSGX has a Current Ratio of 1.70. This is a normal value and indicates that DSGX is financially healthy and should not expect problems in meeting its short term obligations.
DSGX has a Current ratio of 1.70. This is comparable to the rest of the industry: DSGX outperforms 53.74% of its industry peers.
A Quick Ratio of 1.70 indicates that DSGX should not have too much problems paying its short term obligations.
The Quick ratio of DSGX (1.70) 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 | 1.7 | ||
| Quick Ratio | 1.7 |
3. Growth
3.1 Past
DSGX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.19%, which is quite good.
Measured over the past years, DSGX shows a very strong growth in Earnings Per Share. The EPS has been growing by 30.86% on average per year.
Looking at the last year, DSGX shows a quite strong growth in Revenue. The Revenue has grown by 12.68% in the last year.
The Revenue has been growing by 14.85% on average over the past years. This is quite good.
EPS 1Y (TTM)14.19%
EPS 3Y18.17%
EPS 5Y30.86%
EPS Q2Q%7.5%
Revenue 1Y (TTM)12.68%
Revenue growth 3Y15.3%
Revenue growth 5Y14.85%
Sales Q2Q%10.05%
3.2 Future
The Earnings Per Share is expected to grow by 21.92% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 10.60% on average over the next years. This is quite good.
EPS Next Y10.91%
EPS Next 2Y15.63%
EPS Next 3Y24.27%
EPS Next 5Y21.92%
Revenue Next Year10.23%
Revenue Next 2Y10.74%
Revenue Next 3Y10.27%
Revenue Next 5Y10.6%
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 estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 48.76, the valuation of DSGX can be described as expensive.
DSGX's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 25.89. DSGX is valued rather expensively when compared to this.
The Price/Forward Earnings ratio is 37.35, which means the current valuation is very expensive for DSGX.
DSGX's Price/Forward Earnings ratio is in line with the industry average.
DSGX is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 34.59, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.76 | ||
| Fwd PE | 37.35 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DSGX indicates a somewhat cheap valuation: DSGX is cheaper than 75.09% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, DSGX is valued a bit cheaper than 69.75% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.56 | ||
| EV/EBITDA | 25.67 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
DSGX has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as DSGX's earnings are expected to grow with 24.27% in the coming years.
PEG (NY)4.47
PEG (5Y)1.58
EPS Next 2Y15.63%
EPS Next 3Y24.27%
5. Dividend
5.1 Amount
DSGX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NASDAQ:DSGX (11/17/2025, 11:07:58 AM)
82.4
-0.97 (-1.16%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners92.55%
Inst Owner Change5.81%
Ins Owners0.26%
Ins Owner ChangeN/A
Market Cap7.08B
Revenue(TTM)684.78M
Net Income(TTM)148.63M
Analysts77.5
Price Target98.8 (19.9%)
Short Float %1.01%
Short Ratio1.76
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)0
Avg EPS beat(2)-4.34%
Min EPS beat(2)-6.83%
Max EPS beat(2)-1.85%
EPS beat(4)2
Avg EPS beat(4)-1.34%
Min EPS beat(4)-6.83%
Max EPS beat(4)2.86%
EPS beat(8)4
Avg EPS beat(8)-1.75%
EPS beat(12)7
Avg EPS beat(12)0.74%
EPS beat(16)9
Avg EPS beat(16)0.6%
Revenue beat(2)1
Avg Revenue beat(2)-0.24%
Min Revenue beat(2)-1.77%
Max Revenue beat(2)1.29%
Revenue beat(4)2
Avg Revenue beat(4)-0.27%
Min Revenue beat(4)-2.69%
Max Revenue beat(4)2.1%
Revenue beat(8)4
Avg Revenue beat(8)-0.16%
Revenue beat(12)7
Avg Revenue beat(12)-0.19%
Revenue beat(16)11
Avg Revenue beat(16)0.38%
PT rev (1m)0%
PT rev (3m)-2.83%
EPS NQ rev (1m)-0.5%
EPS NQ rev (3m)-5%
EPS NY rev (1m)-0.1%
EPS NY rev (3m)-5.58%
Revenue NQ rev (1m)0.16%
Revenue NQ rev (3m)2.14%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.94%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.76 | ||
| Fwd PE | 37.35 | ||
| P/S | 10.34 | ||
| P/FCF | 30.56 | ||
| P/OCF | 29.73 | ||
| P/B | 4.72 | ||
| P/tB | 45 | ||
| EV/EBITDA | 25.67 |
EPS(TTM)1.69
EY2.05%
EPS(NY)2.21
Fwd EY2.68%
FCF(TTM)2.7
FCFY3.27%
OCF(TTM)2.77
OCFY3.36%
SpS7.97
BVpS17.45
TBVpS1.83
PEG (NY)4.47
PEG (5Y)1.58
Graham Number25.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.46% | ||
| ROE | 9.91% | ||
| ROCE | 12.13% | ||
| ROIC | 9.19% | ||
| ROICexc | 10.88% | ||
| ROICexgc | N/A | ||
| OM | 27.36% | ||
| PM (TTM) | 21.7% | ||
| GM | 76.06% | ||
| FCFM | 33.84% |
ROA(3y)8.11%
ROA(5y)7.3%
ROE(3y)9.67%
ROE(5y)8.67%
ROIC(3y)8.86%
ROIC(5y)7.93%
ROICexc(3y)11.36%
ROICexc(5y)9.99%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)11.7%
ROCE(5y)10.48%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y6.45%
ROICexc growth 5Y18.03%
OM growth 3Y3.87%
OM growth 5Y11.08%
PM growth 3Y2.7%
PM growth 5Y14.15%
GM growth 3Y-0.17%
GM growth 5Y0.52%
F-Score7
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 7.9% | ||
| Cap/Sales | 0.95% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 88.32% | ||
| Profit Quality | 155.89% | ||
| Current Ratio | 1.7 | ||
| Quick Ratio | 1.7 | ||
| Altman-Z | 17.98 |
F-Score7
WACC10.2%
ROIC/WACC0.9
Cap/Depr(3y)8.9%
Cap/Depr(5y)8.08%
Cap/Sales(3y)1.09%
Cap/Sales(5y)1.1%
Profit Quality(3y)168.32%
Profit Quality(5y)189.61%
High Growth Momentum
Growth
EPS 1Y (TTM)14.19%
EPS 3Y18.17%
EPS 5Y30.86%
EPS Q2Q%7.5%
EPS Next Y10.91%
EPS Next 2Y15.63%
EPS Next 3Y24.27%
EPS Next 5Y21.92%
Revenue 1Y (TTM)12.68%
Revenue growth 3Y15.3%
Revenue growth 5Y14.85%
Sales Q2Q%10.05%
Revenue Next Year10.23%
Revenue Next 2Y10.74%
Revenue Next 3Y10.27%
Revenue Next 5Y10.6%
EBIT growth 1Y21.76%
EBIT growth 3Y19.76%
EBIT growth 5Y27.58%
EBIT Next Year72.41%
EBIT Next 3Y29.84%
EBIT Next 5Y23.17%
FCF growth 1Y17.98%
FCF growth 3Y7.45%
FCF growth 5Y16.41%
OCF growth 1Y17.68%
OCF growth 3Y7.57%
OCF growth 5Y16.02%
DESCARTES SYSTEMS GRP/THE / DSGX FAQ
What is the ChartMill fundamental rating of DESCARTES SYSTEMS GRP/THE (DSGX) stock?
ChartMill assigns a fundamental rating of 7 / 10 to DSGX.
What is the valuation status of DESCARTES SYSTEMS GRP/THE (DSGX) stock?
ChartMill assigns a valuation rating of 4 / 10 to DESCARTES SYSTEMS GRP/THE (DSGX). This can be considered as Fairly Valued.
What is the profitability of DSGX stock?
DESCARTES SYSTEMS GRP/THE (DSGX) has a profitability rating of 8 / 10.
How financially healthy is DESCARTES SYSTEMS GRP/THE?
The financial health rating of DESCARTES SYSTEMS GRP/THE (DSGX) is 8 / 10.
What is the earnings growth outlook for DESCARTES SYSTEMS GRP/THE?
The Earnings per Share (EPS) of DESCARTES SYSTEMS GRP/THE (DSGX) is expected to grow by 10.91% in the next year.