PEGASYSTEMS INC (PEGA) Fundamental Analysis & Valuation

NASDAQ:PEGA • US7055731035

Current stock price

41.48 USD
+1.17 (+2.9%)
At close:
41.48 USD
0 (0%)
After Hours:

This PEGA fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. PEGA Profitability Analysis

1.1 Basic Checks

  • In the past year PEGA was profitable.
  • PEGA had a positive operating cash flow in the past year.
  • In multiple years PEGA reported negative net income over the last 5 years.
  • PEGA had a positive operating cash flow in each of the past 5 years.
PEGA Yearly Net Income VS EBIT VS OCF VS FCFPEGA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M

1.2 Ratios

  • The Return On Assets of PEGA (24.11%) is better than 97.45% of its industry peers.
  • PEGA has a better Return On Equity (49.97%) than 95.64% of its industry peers.
  • PEGA's Return On Invested Capital of 22.12% is amongst the best of the industry. PEGA outperforms 94.91% of its industry peers.
  • PEGA had an Average Return On Invested Capital over the past 3 years of 15.39%. This is above the industry average of 10.92%.
  • The last Return On Invested Capital (22.12%) for PEGA is above the 3 year average (15.39%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 24.11%
ROE 49.97%
ROIC 22.12%
ROA(3y)11.4%
ROA(5y)0.96%
ROE(3y)28.69%
ROE(5y)-38.66%
ROIC(3y)15.39%
ROIC(5y)N/A
PEGA Yearly ROA, ROE, ROICPEGA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 -100 -200

1.3 Margins

  • Looking at the Profit Margin, with a value of 22.54%, PEGA belongs to the top of the industry, outperforming 89.45% of the companies in the same industry.
  • PEGA has a better Operating Margin (16.29%) than 83.64% of its industry peers.
  • PEGA has a Gross Margin of 75.86%. This is in the better half of the industry: PEGA outperforms 69.09% of its industry peers.
  • In the last couple of years the Gross Margin of PEGA has grown nicely.
Industry RankSector Rank
OM 16.29%
PM (TTM) 22.54%
GM 75.86%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.74%
GM growth 5Y1.78%
PEGA Yearly Profit, Operating, Gross MarginsPEGA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20 -20 40 60

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9

2. PEGA Health Analysis

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), PEGA is creating value.
  • PEGA has less shares outstanding than it did 1 year ago.
  • PEGA has more shares outstanding than it did 5 years ago.
  • There is no outstanding debt for PEGA. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
PEGA Yearly Shares OutstandingPEGA Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M
PEGA Yearly Total Debt VS Total AssetsPEGA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B

2.2 Solvency

  • PEGA has an Altman-Z score of 7.06. This indicates that PEGA is financially healthy and has little risk of bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 7.06, PEGA belongs to the top of the industry, outperforming 85.09% of the companies in the same industry.
  • There is no outstanding debt for PEGA. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 7.06
ROIC/WACC2.03
WACC10.91%
PEGA Yearly LT Debt VS Equity VS FCFPEGA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M 400M 600M

2.3 Liquidity

  • PEGA has a Current Ratio of 1.33. This is a normal value and indicates that PEGA is financially healthy and should not expect problems in meeting its short term obligations.
  • With a Current ratio value of 1.33, PEGA perfoms like the industry average, outperforming 41.45% of the companies in the same industry.
  • A Quick Ratio of 1.33 indicates that PEGA should not have too much problems paying its short term obligations.
  • PEGA has a Quick ratio of 1.33. This is comparable to the rest of the industry: PEGA outperforms 42.55% of its industry peers.
  • The current and quick ratio evaluation for PEGA 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 RankSector Rank
Current Ratio 1.33
Quick Ratio 1.33
PEGA Yearly Current Assets VS Current LiabilitesPEGA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M 800M 1B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. PEGA Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an impressive 40.33% over the past year.
  • PEGA shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 82.73% yearly.
  • Looking at the last year, PEGA shows a quite strong growth in Revenue. The Revenue has grown by 16.61% in the last year.
  • PEGA shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.40% yearly.
EPS 1Y (TTM)40.33%
EPS 3Y82.73%
EPS 5YN/A
EPS Q2Q%-5.59%
Revenue 1Y (TTM)16.61%
Revenue growth 3Y9.83%
Revenue growth 5Y11.4%
Sales Q2Q%2.75%

3.2 Future

  • PEGA is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.38% yearly.
  • Based on estimates for the next years, PEGA will show a small growth in Revenue. The Revenue will grow by 6.34% on average per year.
EPS Next Y31.48%
EPS Next 2Y20.76%
EPS Next 3Y14.75%
EPS Next 5Y1.38%
Revenue Next Year14.28%
Revenue Next 2Y13.08%
Revenue Next 3Y12.78%
Revenue Next 5Y6.34%

3.3 Evolution

  • The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
PEGA Yearly Revenue VS EstimatesPEGA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 1B 2B 3B
PEGA Yearly EPS VS EstimatesPEGA Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 0 1 2 3

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7

4. PEGA Valuation Analysis

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 19.66, PEGA is valued on the expensive side.
  • Compared to the rest of the industry, the Price/Earnings ratio of PEGA indicates a somewhat cheap valuation: PEGA is cheaper than 69.82% of the companies listed in the same industry.
  • PEGA is valuated rather cheaply when we compare the Price/Earnings ratio to 24.75, which is the current average of the S&P500 Index.
  • A Price/Forward Earnings ratio of 14.99 indicates a correct valuation of PEGA.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of PEGA indicates a somewhat cheap valuation: PEGA is cheaper than 74.91% of the companies listed in the same industry.
  • PEGA is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.10, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 19.66
Fwd PE 14.99
PEGA Price Earnings VS Forward Price EarningsPEGA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, PEGA is valued a bit cheaper than 72.00% of the companies in the same industry.
  • PEGA's Price/Free Cash Flow ratio is rather cheap when compared to the industry. PEGA is cheaper than 81.45% of the companies in the same industry.
Industry RankSector Rank
P/FCF 14.29
EV/EBITDA 20.71
PEGA Per share dataPEGA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

4.3 Compensation for Growth

  • PEGA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • PEGA has an outstanding profitability rating, which may justify a higher PE ratio.
  • PEGA's earnings are expected to grow with 14.75% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.62
PEG (5Y)N/A
EPS Next 2Y20.76%
EPS Next 3Y14.75%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

4

5. PEGA Dividend Analysis

5.1 Amount

  • With a yearly dividend of 0.28%, PEGA is not a good candidate for dividend investing.
  • The stock price of PEGA dropped by -26.01% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
  • Compared to an average industry Dividend Yield of 0.66, PEGA pays a better dividend. On top of this PEGA pays more dividend than 89.09% of the companies listed in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.89, PEGA's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.28%

5.2 History

  • The dividend of PEGA decreases each year by -5.53%.
  • PEGA has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-5.53%
Div Incr Years0
Div Non Decr Years0
PEGA Yearly Dividends per sharePEGA Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.02 0.04 0.06 0.08

5.3 Sustainability

  • 3.92% of the earnings are spent on dividend by PEGA. This is a low number and sustainable payout ratio.
DP3.92%
EPS Next 2Y20.76%
EPS Next 3Y14.75%
PEGA Yearly Income VS Free CF VS DividendPEGA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M
PEGA Dividend Payout.PEGA Dividend Payout, showing the Payout Ratio.PEGA Dividend Payout.PayoutRetained Earnings

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PEGA Fundamentals: All Metrics, Ratios and Statistics

PEGASYSTEMS INC

NASDAQ:PEGA (3/30/2026, 8:24:16 PM)

After market: 41.48 0 (0%)

41.48

+1.17 (+2.9%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)02-10
Earnings (Next)04-20
Inst Owners60.87%
Inst Owner Change3.3%
Ins Owners46.35%
Ins Owner Change-1.53%
Market Cap7.01B
Revenue(TTM)1.75B
Net Income(TTM)393.44M
Analysts84.21
Price Target59.16 (42.62%)
Short Float %7.58%
Short Ratio2.89
Dividend
Industry RankSector Rank
Dividend Yield 0.28%
Yearly Dividend0.09
Dividend Growth(5Y)-5.53%
DP3.92%
Div Incr Years0
Div Non Decr Years0
Ex-Date01-02
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)24.35%
Min EPS beat(2)1.37%
Max EPS beat(2)47.32%
EPS beat(4)4
Avg EPS beat(4)68.65%
Min EPS beat(4)1.37%
Max EPS beat(4)206.69%
EPS beat(8)8
Avg EPS beat(8)50.18%
EPS beat(12)10
Avg EPS beat(12)741.26%
EPS beat(16)12
Avg EPS beat(16)569.07%
Revenue beat(2)2
Avg Revenue beat(2)4.16%
Min Revenue beat(2)0.03%
Max Revenue beat(2)8.29%
Revenue beat(4)4
Avg Revenue beat(4)10.77%
Min Revenue beat(4)0.03%
Max Revenue beat(4)30.76%
Revenue beat(8)6
Avg Revenue beat(8)5.8%
Revenue beat(12)8
Avg Revenue beat(12)4.54%
Revenue beat(16)10
Avg Revenue beat(16)2.8%
PT rev (1m)0.31%
PT rev (3m)-18.5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)10.79%
EPS NY rev (1m)22.41%
EPS NY rev (3m)22.41%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.92%
Revenue NY rev (1m)0.5%
Revenue NY rev (3m)6.64%
Valuation
Industry RankSector Rank
PE 19.66
Fwd PE 14.99
P/S 4.02
P/FCF 14.29
P/OCF 13.88
P/B 8.91
P/tB 9.95
EV/EBITDA 20.71
EPS(TTM)2.11
EY5.09%
EPS(NY)2.77
Fwd EY6.67%
FCF(TTM)2.9
FCFY7%
OCF(TTM)2.99
OCFY7.21%
SpS10.33
BVpS4.66
TBVpS4.17
PEG (NY)0.62
PEG (5Y)N/A
Graham Number14.87
Profitability
Industry RankSector Rank
ROA 24.11%
ROE 49.97%
ROCE 31.81%
ROIC 22.12%
ROICexc 42.23%
ROICexgc 51.29%
OM 16.29%
PM (TTM) 22.54%
GM 75.86%
FCFM 28.11%
ROA(3y)11.4%
ROA(5y)0.96%
ROE(3y)28.69%
ROE(5y)-38.66%
ROIC(3y)15.39%
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)22.13%
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.74%
GM growth 5Y1.78%
F-Score9
Asset Turnover1.07
Health
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Debt/EBITDA 0
Cap/Depr 105.88%
Cap/Sales 0.83%
Interest Coverage 162.14
Cash Conversion 169.49%
Profit Quality 124.73%
Current Ratio 1.33
Quick Ratio 1.33
Altman-Z 7.06
F-Score9
WACC10.91%
ROIC/WACC2.03
Cap/Depr(3y)79.75%
Cap/Depr(5y)92.85%
Cap/Sales(3y)0.84%
Cap/Sales(5y)1.21%
Profit Quality(3y)254.05%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)40.33%
EPS 3Y82.73%
EPS 5YN/A
EPS Q2Q%-5.59%
EPS Next Y31.48%
EPS Next 2Y20.76%
EPS Next 3Y14.75%
EPS Next 5Y1.38%
Revenue 1Y (TTM)16.61%
Revenue growth 3Y9.83%
Revenue growth 5Y11.4%
Sales Q2Q%2.75%
Revenue Next Year14.28%
Revenue Next 2Y13.08%
Revenue Next 3Y12.78%
Revenue Next 5Y6.34%
EBIT growth 1Y76.85%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year28.19%
EBIT Next 3Y19.95%
EBIT Next 5Y-0.44%
FCF growth 1Y45.09%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y46.05%
OCF growth 3Y182.96%
OCF growth 5YN/A

PEGASYSTEMS INC / PEGA Fundamental Analysis FAQ

What is the ChartMill fundamental rating of PEGASYSTEMS INC (PEGA) stock?

ChartMill assigns a fundamental rating of 7 / 10 to PEGA.


What is the valuation status for PEGA stock?

ChartMill assigns a valuation rating of 7 / 10 to PEGASYSTEMS INC (PEGA). This can be considered as Undervalued.


Can you provide the profitability details for PEGASYSTEMS INC?

PEGASYSTEMS INC (PEGA) has a profitability rating of 8 / 10.


What is the valuation of PEGASYSTEMS INC based on its PE and PB ratios?

The Price/Earnings (PE) ratio for PEGASYSTEMS INC (PEGA) is 19.66 and the Price/Book (PB) ratio is 8.91.


What is the expected EPS growth for PEGASYSTEMS INC (PEGA) stock?

The Earnings per Share (EPS) of PEGASYSTEMS INC (PEGA) is expected to grow by 31.48% in the next year.