PARSONS CORP (PSN) Stock Fundamental Analysis
NYSE:PSN - New York Stock Exchange, Inc. - US70202L1026 - Common Stock
Overall PSN gets a fundamental rating of 6 out of 10. We evaluated PSN against 82 industry peers in the Professional Services industry. Both the profitability and the financial health of PSN get a neutral evaluation. Nothing too spectacular is happening here. PSN is growing strongly while it is still valued neutral. This is a good combination! With these ratings, PSN could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
In the past year PSN was profitable.
PSN had a positive operating cash flow in the past year.
In the past 5 years PSN has always been profitable.
Each year in the past 5 years PSN had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.45%, PSN is in line with its industry, outperforming 43.04% of the companies in the same industry.
The Return On Equity of PSN (3.40%) is comparable to the rest of the industry.
PSN has a Return On Invested Capital of 9.43%. This is in the better half of the industry: PSN outperforms 62.03% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PSN is significantly below the industry average of 13.48%.
The last Return On Invested Capital (9.43%) for PSN is above the 3 year average (4.85%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.45% | ||
| ROE | 3.4% | ||
| ROIC | 9.43% |
ROA(3y)2.44%
ROA(5y)2.66%
ROE(3y)5.05%
ROE(5y)5.59%
ROIC(3y)4.85%
ROIC(5y)4.17%
1.3 Margins
With a Profit Margin value of 1.21%, PSN perfoms like the industry average, outperforming 41.77% of the companies in the same industry.
In the last couple of years the Profit Margin of PSN has declined.
The Operating Margin of PSN (7.31%) is better than 60.76% of its industry peers.
PSN's Operating Margin has improved in the last couple of years.
PSN has a worse Gross Margin (21.56%) than 73.42% of its industry peers.
In the last couple of years the Gross Margin of PSN has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.31% | ||
| PM (TTM) | 1.21% | ||
| GM | 21.56% |
OM growth 3Y16.46%
OM growth 5Y12.67%
PM growth 3Y5.61%
PM growth 5Y-14.13%
GM growth 3Y-0.33%
GM growth 5Y1.8%
2. Health
2.1 Basic Checks
PSN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, PSN has more shares outstanding
PSN has more shares outstanding than it did 5 years ago.
The debt/assets ratio for PSN has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.71 indicates that PSN is not in any danger for bankruptcy at the moment.
The Altman-Z score of PSN (3.71) is better than 65.82% of its industry peers.
PSN has a debt to FCF ratio of 2.30. This is a good value and a sign of high solvency as PSN would need 2.30 years to pay back of all of its debts.
PSN's Debt to FCF ratio of 2.30 is fine compared to the rest of the industry. PSN outperforms 69.62% of its industry peers.
A Debt/Equity ratio of 0.54 indicates that PSN is somewhat dependend on debt financing.
PSN has a Debt to Equity ratio (0.54) which is in line with its industry peers.
Although PSN does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.3 | ||
| Altman-Z | 3.71 |
ROIC/WACC1.03
WACC9.17%
2.3 Liquidity
PSN has a Current Ratio of 1.55. This is a normal value and indicates that PSN is financially healthy and should not expect problems in meeting its short term obligations.
PSN's Current ratio of 1.55 is in line compared to the rest of the industry. PSN outperforms 53.16% of its industry peers.
PSN has a Quick Ratio of 1.55. This is a normal value and indicates that PSN is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.55, PSN is in line with its industry, outperforming 53.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
PSN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 40.71%, which is quite impressive.
Measured over the past years, PSN shows a decrease in Earnings Per Share. The EPS has been decreasing by -9.19% on average per year.
Looking at the last year, PSN shows a very strong growth in Revenue. The Revenue has grown by 28.88%.
Measured over the past years, PSN shows a quite strong growth in Revenue. The Revenue has been growing by 9.20% on average per year.
EPS 1Y (TTM)40.71%
EPS 3Y36%
EPS 5Y-9.19%
EPS Q2Q%37.68%
Revenue 1Y (TTM)28.88%
Revenue growth 3Y11.57%
Revenue growth 5Y9.2%
Sales Q2Q%27.6%
3.2 Future
Based on estimates for the next years, PSN will show a very strong growth in Earnings Per Share. The EPS will grow by 23.06% on average per year.
The Revenue is expected to grow by 14.79% on average over the next years. This is quite good.
EPS Next Y40.57%
EPS Next 2Y27.07%
EPS Next 3Y23.06%
EPS Next 5YN/A
Revenue Next Year28.49%
Revenue Next 2Y18.41%
Revenue Next 3Y14.79%
Revenue Next 5YN/A
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 accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
PSN is valuated quite expensively with a Price/Earnings ratio of 30.33.
PSN's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 28.29. PSN is around the same levels.
The Price/Forward Earnings ratio is 24.48, which indicates a rather expensive current valuation of PSN.
PSN's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 24.44. PSN is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.33 | ||
| Fwd PE | 24.48 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PSN.
PSN's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. PSN is cheaper than 73.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.72 | ||
| EV/EBITDA | 18.59 |
4.3 Compensation for Growth
PSN's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PSN has a very decent profitability rating, which may justify a higher PE ratio.
PSN's earnings are expected to grow with 23.06% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.75
PEG (5Y)N/A
EPS Next 2Y27.07%
EPS Next 3Y23.06%
5. Dividend
5.1 Amount
PSN does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
PARSONS CORP
NYSE:PSN (1/21/2025, 8:22:01 PM)
After market: 96.44 0 (0%)96.44
+1.21 (+1.27%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners100.28%
Inst Owner Change-0.48%
Ins Owners0.88%
Ins Owner Change-0.86%
Market Cap10.24B
Analysts85.33
Price Target124.15 (28.73%)
Short Float %2.83%
Short Ratio3.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.63%
Min EPS beat(2)17.43%
Max EPS beat(2)19.84%
EPS beat(4)4
Avg EPS beat(4)14.38%
Min EPS beat(4)8.82%
Max EPS beat(4)19.84%
EPS beat(8)6
Avg EPS beat(8)10.57%
EPS beat(12)8
Avg EPS beat(12)7.01%
EPS beat(16)8
Avg EPS beat(16)-2.59%
Revenue beat(2)2
Avg Revenue beat(2)8.33%
Min Revenue beat(2)7.15%
Max Revenue beat(2)9.5%
Revenue beat(4)4
Avg Revenue beat(4)9.74%
Min Revenue beat(4)7.15%
Max Revenue beat(4)11.84%
Revenue beat(8)8
Avg Revenue beat(8)10.1%
Revenue beat(12)11
Avg Revenue beat(12)8.48%
Revenue beat(16)11
Avg Revenue beat(16)4.81%
PT rev (1m)0.66%
PT rev (3m)17.41%
EPS NQ rev (1m)0%
EPS NQ rev (3m)7.08%
EPS NY rev (1m)0%
EPS NY rev (3m)6.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)5.98%
Revenue NY rev (1m)0%
Revenue NY rev (3m)3.75%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.33 | ||
| Fwd PE | 24.48 | ||
| P/S | 1.57 | ||
| P/FCF | 18.72 | ||
| P/OCF | 17.45 | ||
| P/B | 4.43 | ||
| P/tB | 139.63 | ||
| EV/EBITDA | 18.59 |
EPS(TTM)3.18
EY3.3%
EPS(NY)3.94
Fwd EY4.09%
FCF(TTM)5.15
FCFY5.34%
OCF(TTM)5.53
OCFY5.73%
SpS61.31
BVpS21.78
TBVpS0.69
PEG (NY)0.75
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.45% | ||
| ROE | 3.4% | ||
| ROCE | 12.55% | ||
| ROIC | 9.43% | ||
| ROICexc | 11% | ||
| ROICexgc | 33.16% | ||
| OM | 7.31% | ||
| PM (TTM) | 1.21% | ||
| GM | 21.56% | ||
| FCFM | 8.4% |
ROA(3y)2.44%
ROA(5y)2.66%
ROE(3y)5.05%
ROE(5y)5.59%
ROIC(3y)4.85%
ROIC(5y)4.17%
ROICexc(3y)5.33%
ROICexc(5y)4.66%
ROICexgc(3y)15.99%
ROICexgc(5y)13.68%
ROCE(3y)6.27%
ROCE(5y)5.4%
ROICexcg growth 3Y19.03%
ROICexcg growth 5Y1.89%
ROICexc growth 3Y17.66%
ROICexc growth 5Y3.69%
OM growth 3Y16.46%
OM growth 5Y12.67%
PM growth 3Y5.61%
PM growth 5Y-14.13%
GM growth 3Y-0.33%
GM growth 5Y1.8%
F-Score7
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.3 | ||
| Debt/EBITDA | 2.15 | ||
| Cap/Depr | 37.58% | ||
| Cap/Sales | 0.61% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 100.8% | ||
| Profit Quality | 695.25% | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z | 3.71 |
F-Score7
WACC9.17%
ROIC/WACC1.03
Cap/Depr(3y)24.57%
Cap/Depr(5y)30.81%
Cap/Sales(3y)0.68%
Cap/Sales(5y)0.92%
Profit Quality(3y)243.24%
Profit Quality(5y)223.09%
High Growth Momentum
Growth
EPS 1Y (TTM)40.71%
EPS 3Y36%
EPS 5Y-9.19%
EPS Q2Q%37.68%
EPS Next Y40.57%
EPS Next 2Y27.07%
EPS Next 3Y23.06%
EPS Next 5YN/A
Revenue 1Y (TTM)28.88%
Revenue growth 3Y11.57%
Revenue growth 5Y9.2%
Sales Q2Q%27.6%
Revenue Next Year28.49%
Revenue Next 2Y18.41%
Revenue Next 3Y14.79%
Revenue Next 5YN/A
EBIT growth 1Y87.83%
EBIT growth 3Y29.94%
EBIT growth 5Y23.04%
EBIT Next Year103.99%
EBIT Next 3Y36.91%
EBIT Next 5YN/A
FCF growth 1Y160.23%
FCF growth 3Y12.91%
FCF growth 5Y7.55%
OCF growth 1Y146.3%
OCF growth 3Y12.13%
OCF growth 5Y7.45%