QLYS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 277 industry peers in the Software industry. Both the health and profitability get an excellent rating, making QLYS a very profitable company, without any liquidiy or solvency issues. QLYS is not valued too expensively and it also shows a decent growth rate. These ratings would make QLYS suitable for quality investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

QLYS had positive earnings in the past year.
QLYS had a positive operating cash flow in the past year.
QLYS had positive earnings in each of the past 5 years.
In the past 5 years QLYS always reported a positive cash flow from operatings.

1.2 Ratios

With an excellent Return On Assets value of 18.33%, QLYS belongs to the best of the industry, outperforming 94.95% of the companies in the same industry.
QLYS has a Return On Equity of 35.73%. This is amongst the best in the industry. QLYS outperforms 93.50% of its industry peers.
QLYS has a Return On Invested Capital of 29.68%. This is amongst the best in the industry. QLYS outperforms 96.75% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for QLYS is significantly above the industry average of 10.78%.

		Industry Rank	Sector Rank
ROA	18.33%
ROE	35.73%
ROIC	29.68%

ROA(3y)17.3%

ROA(5y)14.61%

ROE(3y)38.31%

ROE(5y)30.77%

ROIC(3y)30.81%

ROIC(5y)24.74%

1.3 Margins

The Profit Margin of QLYS (28.96%) is better than 89.17% of its industry peers.
In the last couple of years the Profit Margin of QLYS has grown nicely.
QLYS has a Operating Margin of 32.55%. This is amongst the best in the industry. QLYS outperforms 94.22% of its industry peers.
In the last couple of years the Operating Margin of QLYS has grown nicely.
The Gross Margin of QLYS (82.45%) is better than 87.73% of its industry peers.
In the last couple of years the Gross Margin of QLYS has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	32.55%
PM (TTM)	28.96%
GM	82.45%

OM growth 3Y13.04%

OM growth 5Y6.51%

PM growth 3Y18.3%

PM growth 5Y5.81%

GM growth 3Y1.44%

GM growth 5Y0.82%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

QLYS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, QLYS has less shares outstanding
QLYS has less shares outstanding than it did 5 years ago.
There is no outstanding debt for QLYS. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

An Altman-Z score of 6.87 indicates that QLYS is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 6.87, QLYS belongs to the best of the industry, outperforming 80.87% of the companies in the same industry.
There is no outstanding debt for QLYS. 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	6.87

ROIC/WACC2.67

WACC11.11%

2.3 Liquidity

A Current Ratio of 1.38 indicates that QLYS should not have too much problems paying its short term obligations.
QLYS has a Current ratio (1.38) which is comparable to the rest of the industry.
QLYS has a Quick Ratio of 1.38. This is a normal value and indicates that QLYS is financially healthy and should not expect problems in meeting its short term obligations.
QLYS has a Quick ratio (1.38) which is comparable to the rest of the industry.
The current and quick ratio evaluation for QLYS is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.38
Quick Ratio	1.38

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

QLYS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.84%, which is quite good.
Measured over the past years, QLYS shows a very strong growth in Earnings Per Share. The EPS has been growing by 21.24% on average per year.
QLYS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.13%.
The Revenue has been growing by 13.57% on average over the past years. This is quite good.

EPS 1Y (TTM)14.84%

EPS 3Y23.81%

EPS 5Y21.24%

EPS Q2Q%19.23%

Revenue 1Y (TTM)10.13%

Revenue growth 3Y13.9%

Revenue growth 5Y13.57%

Sales Q2Q%10.41%

3.2 Future

QLYS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.68% yearly.
The Revenue is expected to grow by 8.64% on average over the next years. This is quite good.

EPS Next Y16.14%

EPS Next 2Y10.89%

EPS Next 3Y9.32%

EPS Next 5Y8.68%

Revenue Next Year10.33%

Revenue Next 2Y8.99%

Revenue Next 3Y8.23%

Revenue Next 5Y8.64%

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.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 19.23, the valuation of QLYS can be described as rather expensive.
Based on the Price/Earnings ratio, QLYS is valued a bit cheaper than 75.81% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, QLYS is valued a bit cheaper.
QLYS is valuated rather expensively with a Price/Forward Earnings ratio of 17.37.
Based on the Price/Forward Earnings ratio, QLYS is valued a bit cheaper than 76.53% of the companies in the same industry.
QLYS's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.32.

		Industry Rank	Sector Rank
PE	19.23
Fwd PE	17.37

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, QLYS is valued a bit cheaper than 79.42% of the companies in the same industry.
QLYS's Price/Free Cash Flow ratio is rather cheap when compared to the industry. QLYS is cheaper than 80.87% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	17.31
EV/EBITDA	17.92

4.3 Compensation for Growth

QLYS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of QLYS may justify a higher PE ratio.