PROGRESS SOFTWARE CORP (PRGS)
US7433121008 - Common Stock
Taking everything into account, PRGS scores 5 out of 10 in our fundamental rating. PRGS was compared to 279 industry peers in the Software industry. PRGS has an excellent profitability rating, but there are concerns on its financial health. PRGS scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year PRGS was profitable.
In the past year PRGS had a positive cash flow from operations.
In the past 5 years PRGS has always been profitable.
Each year in the past 5 years PRGS had a positive operating cash flow.
1.2 Ratios
The Return On Assets of PRGS (5.10%) is better than 77.06% of its industry peers.
The Return On Equity of PRGS (19.41%) is better than 87.46% of its industry peers.
The Return On Invested Capital of PRGS (9.07%) is better than 84.95% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PRGS is below the industry average of 12.23%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 19.41% | ||
| ROIC | 9.07% |
ROA(3y)5.62%
ROA(5y)5.5%
ROE(3y)19.38%
ROE(5y)17.83%
ROIC(3y)9.64%
ROIC(5y)10.24%
1.3 Margins
PRGS has a Profit Margin of 11.55%. This is in the better half of the industry: PRGS outperforms 79.57% of its industry peers.
PRGS's Profit Margin has declined in the last couple of years.
PRGS has a Operating Margin of 19.55%. This is amongst the best in the industry. PRGS outperforms 87.10% of its industry peers.
In the last couple of years the Operating Margin of PRGS has remained more or less at the same level.
PRGS has a better Gross Margin (82.16%) than 87.10% of its industry peers.
In the last couple of years the Gross Margin of PRGS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.55% | ||
| PM (TTM) | 11.55% | ||
| GM | 82.16% |
OM growth 3Y-10.99%
OM growth 5Y-1.27%
PM growth 3Y-17.53%
PM growth 5Y-5.07%
GM growth 3Y-1.64%
GM growth 5Y-0.13%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PRGS is destroying value.
The number of shares outstanding for PRGS has been increased compared to 1 year ago.
The number of shares outstanding for PRGS has been reduced compared to 5 years ago.
Compared to 1 year ago, PRGS has a worse debt to assets ratio.
2.2 Solvency
PRGS has an Altman-Z score of 2.32. This is not the best score and indicates that PRGS is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.32, PRGS is in line with its industry, outperforming 46.59% of the companies in the same industry.
PRGS has a debt to FCF ratio of 3.61. This is a good value and a sign of high solvency as PRGS would need 3.61 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.61, PRGS is in the better half of the industry, outperforming 61.29% of the companies in the same industry.
PRGS has a Debt/Equity ratio of 1.87. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.87, PRGS is doing worse than 83.15% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | 3.61 | ||
| Altman-Z | 2.32 |
ROIC/WACC0.8
WACC11.27%
2.3 Liquidity
A Current Ratio of 1.23 indicates that PRGS should not have too much problems paying its short term obligations.
PRGS's Current ratio of 1.23 is on the low side compared to the rest of the industry. PRGS is outperformed by 64.52% of its industry peers.
A Quick Ratio of 1.23 indicates that PRGS should not have too much problems paying its short term obligations.
PRGS has a worse Quick ratio (1.23) than 64.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.23 | ||
| Quick Ratio | 1.23 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.82% over the past year.
Measured over the past years, PRGS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.71% on average per year.
PRGS shows a small growth in Revenue. In the last year, the Revenue has grown by 6.05%.
Measured over the past years, PRGS shows a quite strong growth in Revenue. The Revenue has been growing by 12.88% on average per year.
EPS 1Y (TTM)3.82%
EPS 3Y12.2%
EPS 5Y11.71%
EPS Q2Q%16.67%
Revenue 1Y (TTM)6.05%
Revenue growth 3Y16.24%
Revenue growth 5Y12.88%
Sales Q2Q%1.65%
3.2 Future
PRGS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.85% yearly.
Based on estimates for the next years, PRGS will show a small growth in Revenue. The Revenue will grow by 2.78% on average per year.
EPS Next Y12.95%
EPS Next 2Y14.79%
EPS Next 3Y11.85%
EPS Next 5YN/A
Revenue Next Year7.92%
Revenue Next 2Y15.02%
Revenue Next 3Y9.8%
Revenue Next 5Y2.78%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same 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
PRGS is valuated correctly with a Price/Earnings ratio of 14.37.
Based on the Price/Earnings ratio, PRGS is valued cheaper than 89.25% of the companies in the same industry.
PRGS is valuated rather cheaply when we compare the Price/Earnings ratio to 27.73, which is the current average of the S&P500 Index.
PRGS is valuated reasonably with a Price/Forward Earnings ratio of 11.58.
Based on the Price/Forward Earnings ratio, PRGS is valued cheaply inside the industry as 92.47% of the companies are valued more expensively.
PRGS's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.37 | ||
| Fwd PE | 11.58 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PRGS is valued cheaply inside the industry as 87.81% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, PRGS is valued cheaper than 93.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.93 | ||
| EV/EBITDA | 14.04 |
4.3 Compensation for Growth
PRGS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PRGS has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.11
PEG (5Y)1.23
EPS Next 2Y14.79%
EPS Next 3Y11.85%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.06%, PRGS has a reasonable but not impressive dividend return.
PRGS's Dividend Yield is rather good when compared to the industry average which is at 13.26. PRGS pays more dividend than 93.55% of the companies in the same industry.
With a Dividend Yield of 1.06, PRGS pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of PRGS has a limited annual growth rate of 5.35%.
PRGS has been paying a dividend for over 5 years, so it has already some track record.
PRGS has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)5.35%
Div Incr Years0
Div Non Decr Years7
5.3 Sustainability
PRGS pays out 38.33% of its income as dividend. This is a sustainable payout ratio.
PRGS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP38.33%
EPS Next 2Y14.79%
EPS Next 3Y11.85%
PROGRESS SOFTWARE CORP
NASDAQ:PRGS (12/20/2024, 8:00:00 PM)
After market: 66.377 0 (0%)66.38
+0.46 (+0.7%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners112.79%
Inst Owner Change4.79%
Ins Owners1.42%
Ins Owner Change1.54%
Market Cap2.85B
Analysts83.08
Price Target74.46 (12.17%)
Short Float %11.68%
Short Ratio11.68
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Dividend Growth(5Y)5.35%
DP38.33%
Div Incr Years0
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.32%
Min EPS beat(2)8.55%
Max EPS beat(2)12.1%
EPS beat(4)4
Avg EPS beat(4)9.58%
Min EPS beat(4)7.53%
Max EPS beat(4)12.1%
EPS beat(8)8
Avg EPS beat(8)8.94%
EPS beat(12)12
Avg EPS beat(12)9.52%
EPS beat(16)16
Avg EPS beat(16)12.8%
Revenue beat(2)1
Avg Revenue beat(2)0.77%
Min Revenue beat(2)-0.38%
Max Revenue beat(2)1.91%
Revenue beat(4)1
Avg Revenue beat(4)0.19%
Min Revenue beat(4)-0.47%
Max Revenue beat(4)1.91%
Revenue beat(8)3
Avg Revenue beat(8)-0.02%
Revenue beat(12)5
Avg Revenue beat(12)0.07%
Revenue beat(16)6
Avg Revenue beat(16)0.08%
PT rev (1m)1.96%
PT rev (3m)15.87%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.11%
EPS NY rev (1m)0%
EPS NY rev (3m)1.28%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)11.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.71%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.37 | ||
| Fwd PE | 11.58 | ||
| P/S | 3.98 | ||
| P/FCF | 12.93 | ||
| P/OCF | 12.66 | ||
| P/B | 6.69 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.04 |
EPS(TTM)4.62
EY6.96%
EPS(NY)5.73
Fwd EY8.64%
FCF(TTM)5.13
FCFY7.73%
OCF(TTM)5.24
OCFY7.9%
SpS16.67
BVpS9.92
TBVpS-16.12
PEG (NY)1.11
PEG (5Y)1.23
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.1% | ||
| ROE | 19.41% | ||
| ROCE | 10.72% | ||
| ROIC | 9.07% | ||
| ROICexc | 11.04% | ||
| ROICexgc | N/A | ||
| OM | 19.55% | ||
| PM (TTM) | 11.55% | ||
| GM | 82.16% | ||
| FCFM | 30.79% |
ROA(3y)5.62%
ROA(5y)5.5%
ROE(3y)19.38%
ROE(5y)17.83%
ROIC(3y)9.64%
ROIC(5y)10.24%
ROICexc(3y)11.59%
ROICexc(5y)12.52%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)11.4%
ROCE(5y)12.1%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-12.78%
ROICexc growth 5Y-13.38%
OM growth 3Y-10.99%
OM growth 5Y-1.27%
PM growth 3Y-17.53%
PM growth 5Y-5.07%
GM growth 3Y-1.64%
GM growth 5Y-0.13%
F-Score7
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | 3.61 | ||
| Debt/EBITDA | 3.27 | ||
| Cap/Depr | 4.56% | ||
| Cap/Sales | 0.66% | ||
| Interest Coverage | 9.83 | ||
| Cash Conversion | 92.62% | ||
| Profit Quality | 266.58% | ||
| Current Ratio | 1.23 | ||
| Quick Ratio | 1.23 | ||
| Altman-Z | 2.32 |
F-Score7
WACC11.27%
ROIC/WACC0.8
Cap/Depr(3y)7.48%
Cap/Depr(5y)9.64%
Cap/Sales(3y)0.9%
Cap/Sales(5y)1.03%
Profit Quality(3y)219.07%
Profit Quality(5y)260.46%
High Growth Momentum
Growth
EPS 1Y (TTM)3.82%
EPS 3Y12.2%
EPS 5Y11.71%
EPS Q2Q%16.67%
EPS Next Y12.95%
EPS Next 2Y14.79%
EPS Next 3Y11.85%
EPS Next 5YN/A
Revenue 1Y (TTM)6.05%
Revenue growth 3Y16.24%
Revenue growth 5Y12.88%
Sales Q2Q%1.65%
Revenue Next Year7.92%
Revenue Next 2Y15.02%
Revenue Next 3Y9.8%
Revenue Next 5Y2.78%
EBIT growth 1Y3.09%
EBIT growth 3Y3.46%
EBIT growth 5Y11.45%
EBIT Next Year48.29%
EBIT Next 3Y26.36%
EBIT Next 5YN/A
FCF growth 1Y15.44%
FCF growth 3Y6.77%
FCF growth 5Y8.09%
OCF growth 1Y14.84%
OCF growth 3Y6.3%
OCF growth 5Y7.45%