EPAM SYSTEMS INC (EPAM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:EPAM - US29414B1044 - Common Stock
212.61 USD
-2.63 (-1.22%)
212.61 USD
0 (0%)
EPAM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 88 industry peers in the IT Services industry. EPAM has an excellent financial health rating, but there are some minor concerns on its profitability. EPAM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year EPAM was profitable.
- EPAM had a positive operating cash flow in the past year.
- EPAM had positive earnings in each of the past 5 years.
- EPAM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- EPAM has a Return On Assets of 7.67%. This is in the better half of the industry: EPAM outperforms 77.27% of its industry peers.
- EPAM has a Return On Equity of 9.97%. This is in the better half of the industry: EPAM outperforms 65.91% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 10.71%, EPAM is in the better half of the industry, outperforming 78.41% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for EPAM is significantly below the industry average of 29.06%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 9.97% | ||
| ROIC | 10.72% |
ROA(3y)9.87%
ROA(5y)11.06%
ROE(3y)12.84%
ROE(5y)14.88%
ROIC(3y)11.99%
ROIC(5y)12.85%
1.3 Margins
- EPAM's Profit Margin of 7.01% is fine compared to the rest of the industry. EPAM outperforms 69.32% of its industry peers.
- EPAM's Profit Margin has declined in the last couple of years.
- The Operating Margin of EPAM (10.43%) is better than 71.59% of its industry peers.
- In the last couple of years the Operating Margin of EPAM has declined.
- The Gross Margin of EPAM (28.92%) is worse than 62.50% of its industry peers.
- EPAM's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.43% | ||
| PM (TTM) | 7.01% | ||
| GM | 28.92% |
OM growth 3Y-7.14%
OM growth 5Y-2.63%
PM growth 3Y-9.14%
PM growth 5Y-3.32%
GM growth 3Y-3.28%
GM growth 5Y-2.67%
2. Health
2.1 Basic Checks
- EPAM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- The number of shares outstanding for EPAM has been reduced compared to 1 year ago.
- The number of shares outstanding for EPAM has been increased compared to 5 years ago.
- Compared to 1 year ago, EPAM has an improved debt to assets ratio.
2.2 Solvency
- EPAM has an Altman-Z score of 8.89. This indicates that EPAM is financially healthy and has little risk of bankruptcy at the moment.
- EPAM's Altman-Z score of 8.89 is amongst the best of the industry. EPAM outperforms 89.77% of its industry peers.
- EPAM has a debt to FCF ratio of 0.05. This is a very positive value and a sign of high solvency as it would only need 0.05 years to pay back of all of its debts.
- With an excellent Debt to FCF ratio value of 0.05, EPAM belongs to the best of the industry, outperforming 92.05% of the companies in the same industry.
- A Debt/Equity ratio of 0.01 indicates that EPAM is not too dependend on debt financing.
- EPAM has a Debt to Equity ratio of 0.01. This is amongst the best in the industry. EPAM outperforms 82.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Altman-Z | 8.89 |
ROIC/WACC1.17
WACC9.12%
2.3 Liquidity
- EPAM has a Current Ratio of 3.02. This indicates that EPAM is financially healthy and has no problem in meeting its short term obligations.
- EPAM has a Current ratio of 3.02. This is in the better half of the industry: EPAM outperforms 78.41% of its industry peers.
- A Quick Ratio of 3.02 indicates that EPAM has no problem at all paying its short term obligations.
- The Quick ratio of EPAM (3.02) is better than 78.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.02 | ||
| Quick Ratio | 3.02 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 2.97% over the past year.
- EPAM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 14.89% yearly.
- Looking at the last year, EPAM shows a quite strong growth in Revenue. The Revenue has grown by 14.26% in the last year.
- EPAM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.56% yearly.
EPS 1Y (TTM)2.97%
EPS 3Y6.34%
EPS 5Y14.89%
EPS Q2Q%-1.28%
Revenue 1Y (TTM)14.26%
Revenue growth 3Y7.95%
Revenue growth 5Y15.56%
Sales Q2Q%19.43%
3.2 Future
- EPAM is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.17% yearly.
- Based on estimates for the next years, EPAM will show a small growth in Revenue. The Revenue will grow by 7.81% on average per year.
EPS Next Y7.22%
EPS Next 2Y8.1%
EPS Next 3Y9.19%
EPS Next 5Y5.17%
Revenue Next Year15.96%
Revenue Next 2Y11.41%
Revenue Next 3Y10.53%
Revenue Next 5Y7.81%
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.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 19.15, which indicates a rather expensive current valuation of EPAM.
- Compared to the rest of the industry, the Price/Earnings ratio of EPAM indicates a somewhat cheap valuation: EPAM is cheaper than 69.32% of the companies listed in the same industry.
- EPAM's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.38.
- A Price/Forward Earnings ratio of 16.74 indicates a correct valuation of EPAM.
- Based on the Price/Forward Earnings ratio, EPAM is valued a bit cheaper than 68.18% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 24.29. EPAM is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.15 | ||
| Fwd PE | 16.74 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EPAM indicates a somewhat cheap valuation: EPAM is cheaper than 67.05% of the companies listed in the same industry.
- EPAM's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.58 | ||
| EV/EBITDA | 16.33 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)2.65
PEG (5Y)1.29
EPS Next 2Y8.1%
EPS Next 3Y9.19%
5. Dividend
5.1 Amount
- EPAM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
212.61
-2.63 (-1.22%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)11-06 2025-11-06/bmo
Earnings (Next)02-18 2026-02-18/amc
Inst Owners100.2%
Inst Owner Change0.16%
Ins Owners3.62%
Ins Owner Change-0.21%
Market Cap11.74B
Revenue(TTM)5.30B
Net Income(TTM)371.62M
Analysts80
Price Target221.92 (4.38%)
Short Float %5.54%
Short Ratio3.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
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)1.91%
Min EPS beat(2)-0.24%
Max EPS beat(2)4.07%
EPS beat(4)3
Avg EPS beat(4)2.22%
Min EPS beat(4)-0.24%
Max EPS beat(4)4.07%
EPS beat(8)7
Avg EPS beat(8)5.06%
EPS beat(12)11
Avg EPS beat(12)5.54%
EPS beat(16)15
Avg EPS beat(16)10.49%
Revenue beat(2)0
Avg Revenue beat(2)-0.55%
Min Revenue beat(2)-0.61%
Max Revenue beat(2)-0.48%
Revenue beat(4)1
Avg Revenue beat(4)-0.2%
Min Revenue beat(4)-0.61%
Max Revenue beat(4)0.84%
Revenue beat(8)1
Avg Revenue beat(8)-0.58%
Revenue beat(12)1
Avg Revenue beat(12)-0.88%
Revenue beat(16)4
Avg Revenue beat(16)0.18%
PT rev (1m)4.77%
PT rev (3m)1.75%
EPS NQ rev (1m)-0.05%
EPS NQ rev (3m)9%
EPS NY rev (1m)0%
EPS NY rev (3m)3.19%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.14%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.15 | ||
| Fwd PE | 16.74 | ||
| P/S | 2.22 | ||
| P/FCF | 25.58 | ||
| P/OCF | 23.38 | ||
| P/B | 3.15 | ||
| P/tB | 5.6 | ||
| EV/EBITDA | 16.33 |
EPS(TTM)11.1
EY5.22%
EPS(NY)12.7
Fwd EY5.97%
FCF(TTM)8.31
FCFY3.91%
OCF(TTM)9.09
OCFY4.28%
SpS95.91
BVpS67.46
TBVpS37.97
PEG (NY)2.65
PEG (5Y)1.29
Graham Number129.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 9.97% | ||
| ROCE | 13.78% | ||
| ROIC | 10.72% | ||
| ROICexc | 15.51% | ||
| ROICexgc | 37.67% | ||
| OM | 10.43% | ||
| PM (TTM) | 7.01% | ||
| GM | 28.92% | ||
| FCFM | 8.67% |
ROA(3y)9.87%
ROA(5y)11.06%
ROE(3y)12.84%
ROE(5y)14.88%
ROIC(3y)11.99%
ROIC(5y)12.85%
ROICexc(3y)23.93%
ROICexc(5y)27.46%
ROICexgc(3y)44.58%
ROICexgc(5y)48.53%
ROCE(3y)15.43%
ROCE(5y)16.55%
ROICexgc growth 3Y-11.78%
ROICexgc growth 5Y3.36%
ROICexc growth 3Y-20.26%
ROICexc growth 5Y-8.86%
OM growth 3Y-7.14%
OM growth 5Y-2.63%
PM growth 3Y-9.14%
PM growth 5Y-3.32%
GM growth 3Y-3.28%
GM growth 5Y-2.67%
F-Score6
Asset Turnover1.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Debt/EBITDA | 0.04 | ||
| Cap/Depr | 46.68% | ||
| Cap/Sales | 0.82% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 77.89% | ||
| Profit Quality | 123.54% | ||
| Current Ratio | 3.02 | ||
| Quick Ratio | 3.02 | ||
| Altman-Z | 8.89 |
F-Score6
WACC9.12%
ROIC/WACC1.17
Cap/Depr(3y)51.75%
Cap/Depr(5y)79.67%
Cap/Sales(3y)0.99%
Cap/Sales(5y)1.71%
Profit Quality(3y)111.75%
Profit Quality(5y)115.25%
High Growth Momentum
Growth
EPS 1Y (TTM)2.97%
EPS 3Y6.34%
EPS 5Y14.89%
EPS Q2Q%-1.28%
EPS Next Y7.22%
EPS Next 2Y8.1%
EPS Next 3Y9.19%
EPS Next 5Y5.17%
Revenue 1Y (TTM)14.26%
Revenue growth 3Y7.95%
Revenue growth 5Y15.56%
Sales Q2Q%19.43%
Revenue Next Year15.96%
Revenue Next 2Y11.41%
Revenue Next 3Y10.53%
Revenue Next 5Y7.81%
EBIT growth 1Y3.34%
EBIT growth 3Y0.25%
EBIT growth 5Y12.52%
EBIT Next Year19.76%
EBIT Next 3Y13.13%
EBIT Next 5Y11.07%
FCF growth 1Y-14.58%
FCF growth 3Y4.58%
FCF growth 5Y22.87%
OCF growth 1Y-13.01%
OCF growth 3Y-0.77%
OCF growth 5Y14.23%
EPAM SYSTEMS INC / EPAM FAQ
What is the fundamental rating for EPAM stock?
ChartMill assigns a fundamental rating of 5 / 10 to EPAM.
What is the valuation status for EPAM stock?
ChartMill assigns a valuation rating of 4 / 10 to EPAM SYSTEMS INC (EPAM). This can be considered as Fairly Valued.
What is the profitability of EPAM stock?
EPAM SYSTEMS INC (EPAM) has a profitability rating of 5 / 10.
What is the valuation of EPAM SYSTEMS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for EPAM SYSTEMS INC (EPAM) is 19.15 and the Price/Book (PB) ratio is 3.15.