50.38 USD
+0.25 (+0.5%)
50.38 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to PEGA. PEGA was compared to 277 industry peers in the Software industry. PEGA is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. PEGA has a decent growth rate and is not valued too expensively.
1. Profitability
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.
- PEGA had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- PEGA has a Return On Assets of 21.50%. This is amongst the best in the industry. PEGA outperforms 96.39% of its industry peers.
- With an excellent Return On Equity value of 46.57%, PEGA belongs to the best of the industry, outperforming 95.67% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 30.62%, PEGA belongs to the top of the industry, outperforming 97.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.5% | ||
| ROE | 46.57% | ||
| ROIC | 30.62% |
ROA(3y)-5.12%
ROA(5y)-4.63%
ROE(3y)-76.04%
ROE(5y)-50.92%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- Looking at the Profit Margin, with a value of 16.05%, PEGA is in the better half of the industry, outperforming 78.34% of the companies in the same industry.
- Looking at the Operating Margin, with a value of 17.49%, PEGA belongs to the top of the industry, outperforming 84.12% of the companies in the same industry.
- Looking at the Gross Margin, with a value of 75.74%, PEGA is in the better half of the industry, outperforming 68.59% of the companies in the same industry.
- In the last couple of years the Gross Margin of PEGA has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.49% | ||
| PM (TTM) | 16.05% | ||
| GM | 75.74% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.76%
GM growth 5Y2.29%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so PEGA is creating value.
- Compared to 1 year ago, PEGA has more shares outstanding
- The number of shares outstanding for PEGA has been increased compared to 5 years ago.
- Compared to 1 year ago, PEGA has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 9.90 indicates that PEGA is not in any danger for bankruptcy at the moment.
- With an excellent Altman-Z score value of 9.90, PEGA belongs to the best of the industry, outperforming 90.25% 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 Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 9.9 |
ROIC/WACC2.84
WACC10.79%
2.3 Liquidity
- A Current Ratio of 1.36 indicates that PEGA should not have too much problems paying its short term obligations.
- PEGA has a Current ratio of 1.36. This is comparable to the rest of the industry: PEGA outperforms 41.16% of its industry peers.
- A Quick Ratio of 1.36 indicates that PEGA should not have too much problems paying its short term obligations.
- PEGA has a Quick ratio of 1.36. This is comparable to the rest of the industry: PEGA outperforms 41.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.36 |
3. Growth
3.1 Past
- PEGA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 36.08%, which is quite impressive.
- PEGA shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 184.70% yearly.
- PEGA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 17.00%.
- The Revenue has been growing by 10.44% on average over the past years. This is quite good.
EPS 1Y (TTM)36.08%
EPS 3Y184.7%
EPS 5YN/A
EPS Q2Q%53.85%
Revenue 1Y (TTM)17%
Revenue growth 3Y7.31%
Revenue growth 5Y10.44%
Sales Q2Q%17.32%
3.2 Future
- Based on estimates for the next years, PEGA will show a small growth in Earnings Per Share. The EPS will grow by 5.26% on average per year.
- Based on estimates for the next years, PEGA will show a small growth in Revenue. The Revenue will grow by 6.01% on average per year.
EPS Next Y41.66%
EPS Next 2Y22.77%
EPS Next 3Y16.8%
EPS Next 5Y5.26%
Revenue Next Year17.58%
Revenue Next 2Y12.26%
Revenue Next 3Y10.57%
Revenue Next 5Y6.01%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- 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 23.43, which indicates a rather expensive current valuation of PEGA.
- Based on the Price/Earnings ratio, PEGA is valued a bit cheaper than 69.31% of the companies in the same industry.
- PEGA is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 22.28, which indicates a rather expensive current valuation of PEGA.
- Based on the Price/Forward Earnings ratio, PEGA is valued a bit cheaper than 68.23% of the companies in the same industry.
- PEGA's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.43 | ||
| Fwd PE | 22.28 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, PEGA is valued a bit cheaper than the industry average as 72.56% of the companies are valued more expensively.
- Based on the Price/Free Cash Flow ratio, PEGA is valued a bit cheaper than the industry average as 77.98% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.85 | ||
| EV/EBITDA | 25.12 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of PEGA may justify a higher PE ratio.
- PEGA's earnings are expected to grow with 16.80% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.56
PEG (5Y)N/A
EPS Next 2Y22.77%
EPS Next 3Y16.8%
5. Dividend
5.1 Amount
- PEGA has a yearly dividend return of 0.24%, which is pretty low.
- In the last 3 months the price of PEGA has falen by -23.98%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
- PEGA's Dividend Yield is rather good when compared to the industry average which is at 0.52. PEGA pays more dividend than 88.81% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, PEGA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.24% |
5.2 History
- The dividend of PEGA decreases each year by -12.97%.
- PEGA has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-12.97%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- PEGA pays out 4.63% of its income as dividend. This is a sustainable payout ratio.
DP4.63%
EPS Next 2Y22.77%
EPS Next 3Y16.8%
PEGASYSTEMS INC / PEGA FAQ
What is the ChartMill fundamental rating of PEGASYSTEMS INC (PEGA) stock?
ChartMill assigns a fundamental rating of 6 / 10 to PEGA.
What is the valuation status for PEGA stock?
ChartMill assigns a valuation rating of 5 / 10 to PEGASYSTEMS INC (PEGA). This can be considered as Fairly Valued.
Can you provide the profitability details for PEGASYSTEMS INC?
PEGASYSTEMS INC (PEGA) has a profitability rating of 6 / 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 23.43 and the Price/Book (PB) ratio is 14.33.
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 41.66% in the next year.