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POWERSCHOOL HOLDINGS INC-A (PWSC) Stock Fundamental Analysis

USA - New York Stock Exchange - NYSE:PWSC - US73939C1062 - Common Stock

22.81 USD
-0.04 (-0.18%)
Last: 9/30/2024, 8:04:01 PM
22.82 USD
+0.01 (+0.04%)
After Hours: 9/30/2024, 8:04:01 PM
Fundamental Rating

3

Taking everything into account, PWSC scores 3 out of 10 in our fundamental rating. PWSC was compared to 278 industry peers in the Software industry. PWSC has a bad profitability rating. Also its financial health evaluation is rather negative. PWSC is valied quite expensively at the moment, while it does show a decent growth rate.


Dividend Valuation Growth Profitability Health

3

1. Profitability

1.1 Basic Checks

  • PWSC had positive earnings in the past year.
  • PWSC had a positive operating cash flow in the past year.
  • In the past 5 years PWSC always reported negative net income.
  • In the past 5 years PWSC always reported a positive cash flow from operatings.
PWSC Yearly Net Income VS EBIT VS OCF VS FCFPWSC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2019 2020 2021 2022 2023 0 50M -50M 100M 150M

1.2 Ratios

  • PWSC has a Return On Assets of -1.48%. This is comparable to the rest of the industry: PWSC outperforms 58.16% of its industry peers.
  • PWSC has a Return On Equity (-4.32%) which is in line with its industry peers.
  • PWSC has a better Return On Invested Capital (0.35%) than 64.54% of its industry peers.
  • The Average Return On Invested Capital over the past 3 years for PWSC is significantly below the industry average of 10.74%.
Industry RankSector Rank
ROA -1.48%
ROE -4.32%
ROIC 0.35%
ROA(3y)-0.79%
ROA(5y)-1.33%
ROE(3y)-2.27%
ROE(5y)-2.97%
ROIC(3y)0.41%
ROIC(5y)N/A
PWSC Yearly ROA, ROE, ROICPWSC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2019 2020 2021 2022 2023 0 -1 -2 -3 -4 -5

1.3 Margins

  • PWSC's Operating Margin of 2.05% is fine compared to the rest of the industry. PWSC outperforms 65.96% of its industry peers.
  • PWSC's Operating Margin has declined in the last couple of years.
  • With a Gross Margin value of 58.82%, PWSC is not doing good in the industry: 62.06% of the companies in the same industry are doing better.
  • PWSC's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 2.05%
PM (TTM) N/A
GM 58.82%
OM growth 3Y-10.66%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.99%
GM growth 5YN/A
PWSC Yearly Profit, Operating, Gross MarginsPWSC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2019 2020 2021 2022 2023 0 20 -20 40

More info and screens

1

2. Health

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PWSC is destroying value.
  • The number of shares outstanding for PWSC has been increased compared to 1 year ago.
  • PWSC has a worse debt/assets ratio than last year.
PWSC Yearly Shares OutstandingPWSC Yearly Shares OutstandingYearly Shares Outstanding 2019 2020 2021 2022 2023 50M 100M 150M 200M
PWSC Yearly Total Debt VS Total AssetsPWSC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2019 2020 2021 2022 2023 1B 2B 3B

2.2 Solvency

  • PWSC has an Altman-Z score of 1.12. This is a bad value and indicates that PWSC is not financially healthy and even has some risk of bankruptcy.
  • PWSC has a worse Altman-Z score (1.12) than 62.06% of its industry peers.
  • PWSC has a debt to FCF ratio of 12.08. This is a negative value and a sign of low solvency as PWSC would need 12.08 years to pay back of all of its debts.
  • PWSC's Debt to FCF ratio of 12.08 is in line compared to the rest of the industry. PWSC outperforms 48.58% of its industry peers.
  • PWSC has a Debt/Equity ratio of 0.77. This is a neutral value indicating PWSC is somewhat dependend on debt financing.
  • PWSC has a worse Debt to Equity ratio (0.77) than 71.99% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.77
Debt/FCF 12.08
Altman-Z 1.12
ROIC/WACC0.03
WACC10.25%
PWSC Yearly LT Debt VS Equity VS FCFPWSC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2019 2020 2021 2022 2023 500M 1B 1.5B

2.3 Liquidity

  • A Current Ratio of 0.28 indicates that PWSC may have some problems paying its short term obligations.
  • PWSC has a worse Current ratio (0.28) than 96.81% of its industry peers.
  • PWSC has a Quick Ratio of 0.28. This is a bad value and indicates that PWSC is not financially healthy enough and could expect problems in meeting its short term obligations.
  • The Quick ratio of PWSC (0.28) is worse than 96.45% of its industry peers.
Industry RankSector Rank
Current Ratio 0.28
Quick Ratio 0.28
PWSC Yearly Current Assets VS Current LiabilitesPWSC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2019 2020 2021 2022 2023 100M 200M 300M 400M 500M

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5

3. Growth

3.1 Past

  • PWSC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.99%.
  • The Revenue has grown by 12.79% in the past year. This is quite good.
  • PWSC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.06% yearly.
EPS 1Y (TTM)-8.99%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%0%
Revenue 1Y (TTM)12.79%
Revenue growth 3Y17.06%
Revenue growth 5YN/A
Sales Q2Q%10.18%

3.2 Future

  • Based on estimates for the next years, PWSC will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.06% on average per year.
  • PWSC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.40% yearly.
EPS Next Y14.16%
EPS Next 2Y18.27%
EPS Next 3Y16.06%
EPS Next 5YN/A
Revenue Next Year12.84%
Revenue Next 2Y11.67%
Revenue Next 3Y11.4%
Revenue Next 5YN/A

3.3 Evolution

  • Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
PWSC Yearly Revenue VS EstimatesPWSC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 200M 400M 600M 800M
PWSC Yearly EPS VS EstimatesPWSC Yearly EPS VS EstimatesYearly EPS VS Estimates 2021 2022 2023 2024 2025 2026 0.2 0.4 0.6 0.8 1

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3

4. Valuation

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 28.16, PWSC can be considered very expensive at the moment.
  • 73.05% of the companies in the same industry are more expensive than PWSC, based on the Price/Earnings ratio.
  • When comparing the Price/Earnings ratio of PWSC to the average of the S&P500 Index (27.21), we can say PWSC is valued inline with the index average.
  • With a Price/Forward Earnings ratio of 19.89, PWSC is valued on the expensive side.
  • Based on the Price/Forward Earnings ratio, PWSC is valued a bit cheaper than 79.08% of the companies in the same industry.
  • PWSC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 28.16
Fwd PE 19.89
PWSC Price Earnings VS Forward Price EarningsPWSC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PWSC indicates a somewhat cheap valuation: PWSC is cheaper than 71.63% of the companies listed in the same industry.
  • PWSC's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 56.03
EV/EBITDA 35.29
PWSC Per share dataPWSC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 -10

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PWSC does not grow enough to justify the current Price/Earnings ratio.
  • A more expensive valuation may be justified as PWSC's earnings are expected to grow with 16.06% in the coming years.
PEG (NY)1.99
PEG (5Y)N/A
EPS Next 2Y18.27%
EPS Next 3Y16.06%

More info and screens

0

5. Dividend

5.1 Amount

  • PWSC does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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POWERSCHOOL HOLDINGS INC-A / PWSC FAQ

What is the fundamental rating for PWSC stock?

ChartMill assigns a fundamental rating of 3 / 10 to PWSC.


What is the valuation status of POWERSCHOOL HOLDINGS INC-A (PWSC) stock?

ChartMill assigns a valuation rating of 3 / 10 to POWERSCHOOL HOLDINGS INC-A (PWSC). This can be considered as Overvalued.


What is the profitability of PWSC stock?

POWERSCHOOL HOLDINGS INC-A (PWSC) has a profitability rating of 3 / 10.


What is the valuation of POWERSCHOOL HOLDINGS INC-A based on its PE and PB ratios?

The Price/Earnings (PE) ratio for POWERSCHOOL HOLDINGS INC-A (PWSC) is 28.16 and the Price/Book (PB) ratio is 3.61.


What is the earnings growth outlook for POWERSCHOOL HOLDINGS INC-A?

The Earnings per Share (EPS) of POWERSCHOOL HOLDINGS INC-A (PWSC) is expected to grow by 14.16% in the next year.