PEGASYSTEMS INC (PEGA)
US7055731035 - Common Stock
Taking everything into account, PEGA scores 6 out of 10 in our fundamental rating. PEGA was compared to 279 industry peers in the Software industry. PEGA has an average financial health and profitability rating. PEGA has a correct valuation and a medium growth rate.
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.
PEGA had negative earnings in 4 of the past 5 years.
The reported operating cash flow has been mixed in the past 5 years: PEGA reported negative operating cash flow in multiple years.
1.2 Ratios
The Return On Assets of PEGA (7.77%) is better than 83.51% of its industry peers.
With an excellent Return On Equity value of 25.95%, PEGA belongs to the best of the industry, outperforming 90.68% of the companies in the same industry.
PEGA has a Return On Invested Capital of 22.05%. This is amongst the best in the industry. PEGA outperforms 94.98% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.77% | ||
| ROE | 25.95% | ||
| ROIC | 22.05% |
ROA(3y)-8.31%
ROA(5y)-7.59%
ROE(3y)-86.73%
ROE(5y)-57.66%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 8.29%, PEGA is in the better half of the industry, outperforming 75.99% of the companies in the same industry.
PEGA's Profit Margin has improved in the last couple of years.
PEGA's Operating Margin of 11.63% is amongst the best of the industry. PEGA outperforms 80.65% of its industry peers.
The Gross Margin of PEGA (74.40%) is better than 64.16% of its industry peers.
PEGA's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.63% | ||
| PM (TTM) | 8.29% | ||
| GM | 74.4% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5Y31.83%
GM growth 3Y1.95%
GM growth 5Y2.15%
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
PEGA has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, PEGA has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 5.51 indicates that PEGA is not in any danger for bankruptcy at the moment.
PEGA's Altman-Z score of 5.51 is fine compared to the rest of the industry. PEGA outperforms 64.16% of its industry peers.
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 | 1.55 | ||
| Altman-Z | 5.51 |
ROIC/WACC1.92
WACC11.49%
2.3 Liquidity
PEGA has a Current Ratio of 1.09. This is a normal value and indicates that PEGA is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.09, PEGA is doing worse than 72.40% of the companies in the same industry.
PEGA has a Quick Ratio of 1.09. 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 Quick ratio value of 1.09, PEGA is not doing good in the industry: 70.61% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 110.67% over the past year.
The Earnings Per Share has been growing by 30.80% on average over the past years. This is a very strong growth
The Revenue has grown by 9.28% in the past year. This is quite good.
PEGA shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.95% yearly.
EPS 1Y (TTM)110.67%
EPS 3YN/A
EPS 5Y30.8%
EPS Q2Q%-11.36%
Revenue 1Y (TTM)9.28%
Revenue growth 3Y12.08%
Revenue growth 5Y9.95%
Sales Q2Q%-2.87%
3.2 Future
The Earnings Per Share is expected to grow by 3.41% 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 6.07% on average per year.
EPS Next Y19.95%
EPS Next 2Y15.88%
EPS Next 3Y12.55%
EPS Next 5Y3.41%
Revenue Next Year7.86%
Revenue Next 2Y7.47%
Revenue Next 3Y7.5%
Revenue Next 5Y6.07%
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
PEGA is valuated quite expensively with a Price/Earnings ratio of 28.32.
Compared to the rest of the industry, the Price/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 at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.96, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 27.21, which means the current valuation is very expensive for PEGA.
Based on the Price/Forward Earnings ratio, PEGA is valued a bit cheaper than the industry average as 71.68% of the companies are valued more expensively.
PEGA is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.82, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.32 | ||
| Fwd PE | 27.21 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PEGA is valued a bit cheaper than the industry average as 72.40% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, PEGA is valued cheaper than 82.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.75 | ||
| EV/EBITDA | 37.15 |
4.3 Compensation for Growth
PEGA's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEGA has a very decent profitability rating, which may justify a higher PE ratio.
PEGA's earnings are expected to grow with 12.55% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.42
PEG (5Y)0.92
EPS Next 2Y15.88%
EPS Next 3Y12.55%
5. Dividend
5.1 Amount
PEGA has a yearly dividend return of 0.14%, which is pretty low.
PEGA's Dividend Yield is rather good when compared to the industry average which is at 11.80. PEGA pays more dividend than 90.32% of the companies in the same industry.
With a Dividend Yield of 0.14, PEGA pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.14% |
5.2 History
The dividend of PEGA decreases each year by -0.03%.
PEGA has been paying a dividend for at least 10 years, so it has a reliable track record.
PEGA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-0.03%
Div Incr Years0
Div Non Decr Years15
5.3 Sustainability
8.22% of the earnings are spent on dividend by PEGA. This is a low number and sustainable payout ratio.
DP8.22%
EPS Next 2Y15.88%
EPS Next 3Y12.55%
PEGASYSTEMS INC
NASDAQ:PEGA (11/21/2024, 8:00:01 PM)
After market: 89.99 +0.49 (+0.55%)89.5
+2.59 (+2.98%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap7.67B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.14% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.32 | ||
| Fwd PE | 27.21 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.42
PEG (5Y)0.92
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.77% | ||
| ROE | 25.95% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 11.63% | ||
| PM (TTM) | 8.29% | ||
| GM | 74.4% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.94
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)110.67%
EPS 3YN/A
EPS 5Y
EPS Q2Q%
EPS Next Y19.95%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)9.28%
Revenue growth 3Y12.08%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y