PEGASYSTEMS INC (PEGA) Fundamental Analysis & Valuation

NASDAQ:PEGA • US7055731035

Current stock price

42.48 USD
-0.37 (-0.86%)
At close:
42.48 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.
  • In the past year PEGA had a positive cash flow from operations.
  • In multiple years PEGA reported negative net income over the last 5 years.
  • In the past 5 years PEGA always reported a positive cash flow from operatings.
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

  • PEGA's Return On Assets of 24.11% is amongst the best of the industry. PEGA outperforms 97.47% of its industry peers.
  • PEGA has a better Return On Equity (49.97%) than 95.67% of its industry peers.
  • PEGA has a Return On Invested Capital of 22.12%. This is amongst the best in the industry. PEGA outperforms 94.95% of its industry peers.
  • Measured over the past 3 years, the Average Return On Invested Capital for PEGA is above the industry average of 10.87%.
  • 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

  • With an excellent Profit Margin value of 22.54%, PEGA belongs to the best of the industry, outperforming 89.17% of the companies in the same industry.
  • PEGA's Operating Margin of 16.29% is amongst the best of the industry. PEGA outperforms 83.75% of its industry peers.
  • PEGA has a Gross Margin of 75.86%. This is in the better half of the industry: PEGA outperforms 68.95% 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

  • PEGA has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
  • The number of shares outstanding for PEGA has been reduced compared to 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 7.32. This indicates that PEGA is financially healthy and has little risk of bankruptcy at the moment.
  • PEGA's Altman-Z score of 7.32 is amongst the best of the industry. PEGA outperforms 84.12% of its industry peers.
  • PEGA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 7.32
ROIC/WACC2.08
WACC10.61%
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.
  • PEGA has a Current ratio (1.33) which is in line with its industry peers.
  • PEGA has a Quick 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.
  • The Quick ratio of PEGA (1.33) is comparable to the rest of the industry.
  • 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

  • PEGA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 40.33%, which is quite impressive.
  • The Earnings Per Share has been growing by 82.73% on average over the past years. This is a very strong growth
  • 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

  • The Earnings Per Share is expected to grow by 1.38% on average over the next years.
  • 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

  • PEGA is valuated rather expensively with a Price/Earnings ratio of 20.13.
  • Based on the Price/Earnings ratio, PEGA is valued a bit cheaper than 71.12% of the companies in the same industry.
  • PEGA's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.11.
  • A Price/Forward Earnings ratio of 15.35 indicates a correct valuation of PEGA.
  • 74.73% of the companies in the same industry are more expensive than PEGA, based on the Price/Forward Earnings ratio.
  • When comparing the Price/Forward Earnings ratio of PEGA to the average of the S&P500 Index (24.12), we can say PEGA is valued slightly cheaper.
Industry RankSector Rank
PE 20.13
Fwd PE 15.35
PEGA Price Earnings VS Forward Price EarningsPEGA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, PEGA is valued a bit cheaper than 71.84% of the companies in the same industry.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of PEGA indicates a rather cheap valuation: PEGA is cheaper than 81.95% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 14.63
EV/EBITDA 21.95
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)0.64
PEG (5Y)N/A
EPS Next 2Y20.76%
EPS Next 3Y14.75%

More info and screens

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 -30.55% 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.
  • PEGA's Dividend Yield is rather good when compared to the industry average which is at 0.59. PEGA pays more dividend than 89.17% of the companies in the same industry.
  • With a Dividend Yield of 0.28, PEGA pays less dividend than the S&P500 average, which is at 1.91.
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

  • PEGA pays out 3.92% of its income as dividend. This is a 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 (3/17/2026, 8:00:01 PM)

After market: 42.48 0 (0%)

42.48

-0.37 (-0.86%)

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-1.72%
Market Cap7.18B
Revenue(TTM)1.75B
Net Income(TTM)393.44M
Analysts84.21
Price Target58.97 (38.82%)
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)-18.76%
PT rev (3m)-17.56%
EPS NQ rev (1m)10.79%
EPS NQ rev (3m)10.79%
EPS NY rev (1m)22.41%
EPS NY rev (3m)21.37%
Revenue NQ rev (1m)-1.92%
Revenue NQ rev (3m)-1.92%
Revenue NY rev (1m)6.64%
Revenue NY rev (3m)7.2%
Valuation
Industry RankSector Rank
PE 20.13
Fwd PE 15.35
P/S 4.11
P/FCF 14.63
P/OCF 14.21
P/B 9.12
P/tB 10.19
EV/EBITDA 21.95
EPS(TTM)2.11
EY4.97%
EPS(NY)2.77
Fwd EY6.52%
FCF(TTM)2.9
FCFY6.83%
OCF(TTM)2.99
OCFY7.04%
SpS10.33
BVpS4.66
TBVpS4.17
PEG (NY)0.64
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 7.32
F-Score9
WACC10.61%
ROIC/WACC2.08
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 20.13 and the Price/Book (PB) ratio is 9.12.


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.