Q2 HOLDINGS INC (QTWO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:QTWO - US74736L1098 - Common Stock
71.73 USD
-0.96 (-1.32%)
71.73 USD
0 (0%)
Overall QTWO gets a fundamental rating of 5 out of 10. We evaluated QTWO against 280 industry peers in the Software industry. QTWO has an average financial health and profitability rating. QTWO is growing strongly while it is still valued neutral. This is a good combination!
1. Profitability
1.1 Basic Checks
In the past year QTWO was profitable.
QTWO had a positive operating cash flow in the past year.
QTWO had negative earnings in each of the past 5 years.
Of the past 5 years QTWO 4 years had a positive operating cash flow.
1.2 Ratios
QTWO's Return On Assets of 2.22% is fine compared to the rest of the industry. QTWO outperforms 64.64% of its industry peers.
QTWO's Return On Equity of 5.09% is fine compared to the rest of the industry. QTWO outperforms 69.64% of its industry peers.
QTWO's Return On Invested Capital of 3.00% is fine compared to the rest of the industry. QTWO outperforms 69.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.22% | ||
| ROE | 5.09% | ||
| ROIC | 3% |
ROA(3y)-5.5%
ROA(5y)-6.87%
ROE(3y)-16.01%
ROE(5y)-17.84%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
QTWO has a better Profit Margin (4.12%) than 64.64% of its industry peers.
QTWO has a better Operating Margin (3.43%) than 66.79% of its industry peers.
QTWO has a Gross Margin of 53.37%. This is in the lower half of the industry: QTWO underperforms 67.14% of its industry peers.
In the last couple of years the Gross Margin of QTWO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.43% | ||
| PM (TTM) | 4.12% | ||
| GM | 53.37% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y4.1%
GM growth 5Y0.97%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so QTWO is destroying value.
The number of shares outstanding for QTWO has been increased compared to 1 year ago.
QTWO has more shares outstanding than it did 5 years ago.
QTWO has a better debt/assets ratio than last year.
2.2 Solvency
QTWO has an Altman-Z score of 3.35. This indicates that QTWO is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.35, QTWO is doing good in the industry, outperforming 63.21% of the companies in the same industry.
There is no outstanding debt for QTWO. 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 | 3.22 | ||
| Altman-Z | 3.35 |
ROIC/WACC0.29
WACC10.47%
2.3 Liquidity
A Current Ratio of 0.97 indicates that QTWO may have some problems paying its short term obligations.
The Current ratio of QTWO (0.97) is worse than 76.07% of its industry peers.
A Quick Ratio of 0.97 indicates that QTWO may have some problems paying its short term obligations.
The Quick ratio of QTWO (0.97) is worse than 74.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 71.97% over the past year.
The Earnings Per Share has been growing by 33.28% on average over the past years. This is a very strong growth
QTWO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.93%.
QTWO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.16% yearly.
EPS 1Y (TTM)71.97%
EPS 3Y72.41%
EPS 5Y33.28%
EPS Q2Q%45.45%
Revenue 1Y (TTM)13.93%
Revenue growth 3Y11.78%
Revenue growth 5Y17.16%
Sales Q2Q%15.25%
3.2 Future
The Earnings Per Share is expected to grow by 19.47% on average over the next years. This is quite good.
QTWO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.67% yearly.
EPS Next Y39.32%
EPS Next 2Y23.9%
EPS Next 3Y19.47%
EPS Next 5YN/A
Revenue Next Year13.39%
Revenue Next 2Y11.96%
Revenue Next 3Y11.67%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 31.60 indicates a quite expensive valuation of QTWO.
Based on the Price/Earnings ratio, QTWO is valued a bit cheaper than 61.43% of the companies in the same industry.
When comparing the Price/Earnings ratio of QTWO to the average of the S&P500 Index (25.98), we can say QTWO is valued slightly more expensively.
A Price/Forward Earnings ratio of 28.49 indicates a quite expensive valuation of QTWO.
The rest of the industry has a similar Price/Forward Earnings ratio as QTWO.
The average S&P500 Price/Forward Earnings ratio is at 35.79. QTWO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.6 | ||
| Fwd PE | 28.49 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, QTWO is valued a bit cheaper than the industry average as 61.79% of the companies are valued more expensively.
69.64% of the companies in the same industry are more expensive than QTWO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.15 | ||
| EV/EBITDA | 52.44 |
4.3 Compensation for Growth
QTWO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as QTWO's earnings are expected to grow with 19.47% in the coming years.
PEG (NY)0.8
PEG (5Y)0.95
EPS Next 2Y23.9%
EPS Next 3Y19.47%
5. Dividend
5.1 Amount
No dividends for QTWO!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
71.73
-0.96 (-1.32%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners106.25%
Inst Owner Change5.88%
Ins Owners0.5%
Ins Owner Change-1.88%
Market Cap4.48B
Revenue(TTM)769.63M
Net Income(TTM)31.73M
Analysts79.13
Price Target90.7 (26.45%)
Short Float %4.33%
Short Ratio1.96
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.04%
Min EPS beat(2)7.29%
Max EPS beat(2)14.78%
EPS beat(4)4
Avg EPS beat(4)11.25%
Min EPS beat(4)7.29%
Max EPS beat(4)14.78%
EPS beat(8)7
Avg EPS beat(8)9.45%
EPS beat(12)10
Avg EPS beat(12)19.61%
EPS beat(16)13
Avg EPS beat(16)29.39%
Revenue beat(2)0
Avg Revenue beat(2)-0.65%
Min Revenue beat(2)-1.24%
Max Revenue beat(2)-0.06%
Revenue beat(4)0
Avg Revenue beat(4)-0.48%
Min Revenue beat(4)-1.24%
Max Revenue beat(4)-0.06%
Revenue beat(8)0
Avg Revenue beat(8)-0.77%
Revenue beat(12)0
Avg Revenue beat(12)-1.17%
Revenue beat(16)0
Avg Revenue beat(16)-1.38%
PT rev (1m)-13.6%
PT rev (3m)-13.26%
EPS NQ rev (1m)3.1%
EPS NQ rev (3m)2.79%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.15%
Revenue NQ rev (1m)0.46%
Revenue NQ rev (3m)0.44%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.6 | ||
| Fwd PE | 28.49 | ||
| P/S | 5.82 | ||
| P/FCF | 29.15 | ||
| P/OCF | 24.77 | ||
| P/B | 7.19 | ||
| P/tB | 161.7 | ||
| EV/EBITDA | 52.44 |
EPS(TTM)2.27
EY3.16%
EPS(NY)2.52
Fwd EY3.51%
FCF(TTM)2.46
FCFY3.43%
OCF(TTM)2.9
OCFY4.04%
SpS12.33
BVpS9.98
TBVpS0.44
PEG (NY)0.8
PEG (5Y)0.95
Graham Number22.57
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.22% | ||
| ROE | 5.09% | ||
| ROCE | 3.8% | ||
| ROIC | 3% | ||
| ROICexc | 16.52% | ||
| ROICexgc | N/A | ||
| OM | 3.43% | ||
| PM (TTM) | 4.12% | ||
| GM | 53.37% | ||
| FCFM | 19.96% |
ROA(3y)-5.5%
ROA(5y)-6.87%
ROE(3y)-16.01%
ROE(5y)-17.84%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y4.1%
GM growth 5Y0.97%
F-Score7
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 3.22 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 47.78% | ||
| Cap/Sales | 3.53% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 217.07% | ||
| Profit Quality | 484.18% | ||
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 | ||
| Altman-Z | 3.35 |
F-Score7
WACC10.47%
ROIC/WACC0.29
Cap/Depr(3y)44.55%
Cap/Depr(5y)45.59%
Cap/Sales(3y)4.8%
Cap/Sales(5y)5.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)71.97%
EPS 3Y72.41%
EPS 5Y33.28%
EPS Q2Q%45.45%
EPS Next Y39.32%
EPS Next 2Y23.9%
EPS Next 3Y19.47%
EPS Next 5YN/A
Revenue 1Y (TTM)13.93%
Revenue growth 3Y11.78%
Revenue growth 5Y17.16%
Sales Q2Q%15.25%
Revenue Next Year13.39%
Revenue Next 2Y11.96%
Revenue Next 3Y11.67%
Revenue Next 5YN/A
EBIT growth 1Y152.74%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year91.04%
EBIT Next 3Y39.61%
EBIT Next 5YN/A
FCF growth 1Y212.31%
FCF growth 3Y169.21%
FCF growth 5YN/A
OCF growth 1Y130.23%
OCF growth 3Y63.45%
OCF growth 5Y198.8%
Q2 HOLDINGS INC / QTWO FAQ
What is the fundamental rating for QTWO stock?
ChartMill assigns a fundamental rating of 5 / 10 to QTWO.
What is the valuation status for QTWO stock?
ChartMill assigns a valuation rating of 4 / 10 to Q2 HOLDINGS INC (QTWO). This can be considered as Fairly Valued.
Can you provide the profitability details for Q2 HOLDINGS INC?
Q2 HOLDINGS INC (QTWO) has a profitability rating of 4 / 10.
What is the valuation of Q2 HOLDINGS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for Q2 HOLDINGS INC (QTWO) is 31.6 and the Price/Book (PB) ratio is 7.19.