SPS COMMERCE INC (SPSC) Stock Fundamental Analysis
NASDAQ:SPSC - Nasdaq - US78463M1071 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to SPSC. SPSC was compared to 283 industry peers in the Software industry. SPSC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. SPSC is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make SPSC suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
SPSC had positive earnings in the past year.
SPSC had a positive operating cash flow in the past year.
In the past 5 years SPSC has always been profitable.
In the past 5 years SPSC always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of SPSC (7.47%) is better than 83.39% of its industry peers.
The Return On Equity of SPSC (9.02%) is better than 79.15% of its industry peers.
SPSC has a Return On Invested Capital of 7.76%. This is amongst the best in the industry. SPSC outperforms 81.63% of its industry peers.
SPSC had an Average Return On Invested Capital over the past 3 years of 8.71%. This is below the industry average of 11.63%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 9.02% | ||
| ROIC | 7.76% |
ROA(3y)7.88%
ROA(5y)7.91%
ROE(3y)9.71%
ROE(5y)9.84%
ROIC(3y)8.71%
ROIC(5y)8.62%
1.3 Margins
Looking at the Profit Margin, with a value of 12.08%, SPSC is in the better half of the industry, outperforming 77.39% of the companies in the same industry.
SPSC's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 13.94%, SPSC belongs to the best of the industry, outperforming 82.69% of the companies in the same industry.
SPSC's Operating Margin has been stable in the last couple of years.
SPSC has a Gross Margin (66.96%) which is in line with its industry peers.
In the last couple of years the Gross Margin of SPSC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.94% | ||
| PM (TTM) | 12.08% | ||
| GM | 66.96% |
OM growth 3Y-0.86%
OM growth 5Y0.26%
PM growth 3Y1.44%
PM growth 5Y0.01%
GM growth 3Y0.57%
GM growth 5Y0%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SPSC is destroying value.
The number of shares outstanding for SPSC has been increased compared to 1 year ago.
Compared to 5 years ago, SPSC has more shares outstanding
SPSC has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
SPSC has an Altman-Z score of 18.68. This indicates that SPSC is financially healthy and has little risk of bankruptcy at the moment.
SPSC has a Altman-Z score of 18.68. This is amongst the best in the industry. SPSC outperforms 92.93% of its industry peers.
SPSC has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 18.68 |
ROIC/WACC0.56
WACC13.81%
2.3 Liquidity
A Current Ratio of 2.60 indicates that SPSC has no problem at all paying its short term obligations.
SPSC's Current ratio of 2.60 is fine compared to the rest of the industry. SPSC outperforms 71.73% of its industry peers.
A Quick Ratio of 2.60 indicates that SPSC has no problem at all paying its short term obligations.
SPSC has a Quick ratio of 2.60. This is in the better half of the industry: SPSC outperforms 72.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.6 | ||
| Quick Ratio | 2.6 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 21.33% over the past year.
Measured over the past years, SPSC shows a very strong growth in Earnings Per Share. The EPS has been growing by 22.07% on average per year.
SPSC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 18.77%.
SPSC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.97% yearly.
EPS 1Y (TTM)21.33%
EPS 3Y23.77%
EPS 5Y22.07%
EPS Q2Q%18.67%
Revenue 1Y (TTM)18.77%
Revenue growth 3Y18.29%
Revenue growth 5Y17.97%
Sales Q2Q%17.9%
3.2 Future
Based on estimates for the next years, SPSC will show a quite strong growth in Earnings Per Share. The EPS will grow by 17.27% on average per year.
The Revenue is expected to grow by 16.38% on average over the next years. This is quite good.
EPS Next Y13.55%
EPS Next 2Y17.03%
EPS Next 3Y17.27%
EPS Next 5YN/A
Revenue Next Year19.65%
Revenue Next 2Y16.5%
Revenue Next 3Y16.38%
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 Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SPSC is valuated quite expensively with a Price/Earnings ratio of 38.57.
Based on the Price/Earnings ratio, SPSC is valued a bit cheaper than the industry average as 65.72% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 29.71. SPSC is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 33.97, the valuation of SPSC can be described as expensive.
Based on the Price/Forward Earnings ratio, SPSC is valued a bit cheaper than the industry average as 65.37% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.34, SPSC is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.57 | ||
| Fwd PE | 33.97 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SPSC indicates a somewhat cheap valuation: SPSC is cheaper than 72.79% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, SPSC is valued a bit cheaper than 70.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.98 | ||
| EV/EBITDA | 36.41 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SPSC does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of SPSC may justify a higher PE ratio.
SPSC's earnings are expected to grow with 17.27% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.85
PEG (5Y)1.75
EPS Next 2Y17.03%
EPS Next 3Y17.27%
5. Dividend
5.1 Amount
No dividends for SPSC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
133.83
+1.67 (+1.26%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners100.85%
Inst Owner Change1.47%
Ins Owners0.69%
Ins Owner Change120.26%
Market Cap5.08B
Analysts78.89
Price Target205.25 (53.37%)
Short Float %3.17%
Short Ratio4.18
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)4.96%
Min EPS beat(2)0.86%
Max EPS beat(2)9.06%
EPS beat(4)4
Avg EPS beat(4)6.69%
Min EPS beat(4)0.86%
Max EPS beat(4)14.68%
EPS beat(8)8
Avg EPS beat(8)7.85%
EPS beat(12)12
Avg EPS beat(12)9.61%
EPS beat(16)16
Avg EPS beat(16)10.09%
Revenue beat(2)1
Avg Revenue beat(2)-0.45%
Min Revenue beat(2)-1.01%
Max Revenue beat(2)0.11%
Revenue beat(4)2
Avg Revenue beat(4)-0.43%
Min Revenue beat(4)-1.01%
Max Revenue beat(4)0.11%
Revenue beat(8)2
Avg Revenue beat(8)-0.56%
Revenue beat(12)2
Avg Revenue beat(12)-0.84%
Revenue beat(16)5
Avg Revenue beat(16)-0.56%
PT rev (1m)-7.21%
PT rev (3m)-10.74%
EPS NQ rev (1m)-5.95%
EPS NQ rev (3m)-6.49%
EPS NY rev (1m)1.98%
EPS NY rev (3m)-0.95%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)2.44%
Revenue NY rev (1m)0.9%
Revenue NY rev (3m)2.92%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.57 | ||
| Fwd PE | 33.97 | ||
| P/S | 7.96 | ||
| P/FCF | 36.98 | ||
| P/OCF | 32.27 | ||
| P/B | 5.94 | ||
| P/tB | 18.52 | ||
| EV/EBITDA | 36.41 |
EPS(TTM)3.47
EY2.59%
EPS(NY)3.94
Fwd EY2.94%
FCF(TTM)3.62
FCFY2.7%
OCF(TTM)4.15
OCFY3.1%
SpS16.81
BVpS22.52
TBVpS7.23
PEG (NY)2.85
PEG (5Y)1.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | 9.02% | ||
| ROCE | 10.05% | ||
| ROIC | 7.76% | ||
| ROICexc | 10.66% | ||
| ROICexgc | 108.82% | ||
| OM | 13.94% | ||
| PM (TTM) | 12.08% | ||
| GM | 66.96% | ||
| FCFM | 21.54% |
ROA(3y)7.88%
ROA(5y)7.91%
ROE(3y)9.71%
ROE(5y)9.84%
ROIC(3y)8.71%
ROIC(5y)8.62%
ROICexc(3y)13.58%
ROICexc(5y)14.47%
ROICexgc(3y)98.15%
ROICexgc(5y)87.03%
ROCE(3y)11.28%
ROCE(5y)11.17%
ROICexcg growth 3Y10.82%
ROICexcg growth 5Y19.47%
ROICexc growth 3Y-13.8%
ROICexc growth 5Y-9.82%
OM growth 3Y-0.86%
OM growth 5Y0.26%
PM growth 3Y1.44%
PM growth 5Y0.01%
GM growth 3Y0.57%
GM growth 5Y0%
F-Score6
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 47.47% | ||
| Cap/Sales | 3.14% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 120.05% | ||
| Profit Quality | 178.25% | ||
| Current Ratio | 2.6 | ||
| Quick Ratio | 2.6 | ||
| Altman-Z | 18.68 |
F-Score6
WACC13.81%
ROIC/WACC0.56
Cap/Depr(3y)58.3%
Cap/Depr(5y)68.47%
Cap/Sales(3y)3.75%
Cap/Sales(5y)4.32%
Profit Quality(3y)164.93%
Profit Quality(5y)172.42%
High Growth Momentum
Growth
EPS 1Y (TTM)21.33%
EPS 3Y23.77%
EPS 5Y22.07%
EPS Q2Q%18.67%
EPS Next Y13.55%
EPS Next 2Y17.03%
EPS Next 3Y17.27%
EPS Next 5YN/A
Revenue 1Y (TTM)18.77%
Revenue growth 3Y18.29%
Revenue growth 5Y17.97%
Sales Q2Q%17.9%
Revenue Next Year19.65%
Revenue Next 2Y16.5%
Revenue Next 3Y16.38%
Revenue Next 5YN/A
EBIT growth 1Y15.16%
EBIT growth 3Y17.28%
EBIT growth 5Y18.28%
EBIT Next Year35.54%
EBIT Next 3Y22.48%
EBIT Next 5YN/A
FCF growth 1Y22.05%
FCF growth 3Y13.76%
FCF growth 5Y18.74%
OCF growth 1Y18.97%
OCF growth 3Y11.71%
OCF growth 5Y17%