90.61 USD
-1.67 (-1.81%)
90.61 USD
0 (0%)
SPSC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 277 industry peers in the Software industry. SPSC has an excellent financial health rating, but there are some minor concerns on its profitability. SPSC is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make SPSC suitable for growth investing!
1. Profitability
1.1 Basic Checks
- In the past year SPSC was profitable.
- SPSC had a positive operating cash flow in the past year.
- SPSC had positive earnings in each of the past 5 years.
- Each year in the past 5 years SPSC had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 7.34%, SPSC is in the better half of the industry, outperforming 77.26% of the companies in the same industry.
- The Return On Equity of SPSC (8.87%) is better than 72.20% of its industry peers.
- SPSC has a Return On Invested Capital of 8.38%. This is in the better half of the industry: SPSC outperforms 79.42% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for SPSC is below the industry average of 10.78%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.34% | ||
| ROE | 8.87% | ||
| ROIC | 8.38% |
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
- SPSC's Profit Margin of 11.66% is fine compared to the rest of the industry. SPSC outperforms 71.84% of its industry peers.
- In the last couple of years the Profit Margin of SPSC has remained more or less at the same level.
- Looking at the Operating Margin, with a value of 14.85%, SPSC belongs to the top of the industry, outperforming 81.59% of the companies in the same industry.
- In the last couple of years the Operating Margin of SPSC has remained more or less at the same level.
- SPSC has a Gross Margin (68.45%) 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 | 14.85% | ||
| PM (TTM) | 11.66% | ||
| GM | 68.45% |
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.
- Compared to 1 year ago, SPSC has more shares outstanding
- 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
- An Altman-Z score of 12.04 indicates that SPSC is not in any danger for bankruptcy at the moment.
- SPSC has a Altman-Z score of 12.04. This is amongst the best in the industry. SPSC outperforms 92.06% 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 | 12.04 |
ROIC/WACC0.75
WACC11.1%
2.3 Liquidity
- A Current Ratio of 1.97 indicates that SPSC should not have too much problems paying its short term obligations.
- SPSC has a Current ratio (1.97) which is comparable to the rest of the industry.
- A Quick Ratio of 1.97 indicates that SPSC should not have too much problems paying its short term obligations.
- SPSC's Quick ratio of 1.97 is in line compared to the rest of the industry. SPSC outperforms 59.21% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.97 | ||
| Quick Ratio | 1.97 |
3. Growth
3.1 Past
- SPSC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.72%, which is quite impressive.
- SPSC shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 22.07% yearly.
- Looking at the last year, SPSC shows a quite strong growth in Revenue. The Revenue has grown by 19.28% in the last year.
- The Revenue has been growing by 17.97% on average over the past years. This is quite good.
EPS 1Y (TTM)20.72%
EPS 3Y23.77%
EPS 5Y22.07%
EPS Q2Q%22.83%
Revenue 1Y (TTM)19.28%
Revenue growth 3Y18.29%
Revenue growth 5Y17.97%
Sales Q2Q%16.02%
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 14.87% on average per year.
- The Revenue is expected to grow by 10.83% on average over the next years. This is quite good.
EPS Next Y21.39%
EPS Next 2Y15.4%
EPS Next 3Y14.87%
EPS Next 5YN/A
Revenue Next Year18.26%
Revenue Next 2Y12.67%
Revenue Next 3Y10.83%
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
- SPSC is valuated rather expensively with a Price/Earnings ratio of 22.54.
- Based on the Price/Earnings ratio, SPSC is valued a bit cheaper than 69.68% of the companies in the same industry.
- SPSC is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 19.61, the valuation of SPSC can be described as rather expensive.
- Based on the Price/Forward Earnings ratio, SPSC is valued a bit cheaper than the industry average as 72.56% of the companies are valued more expensively.
- The average S&P500 Price/Forward Earnings ratio is at 24.26. SPSC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.54 | ||
| Fwd PE | 19.61 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, SPSC is valued a bit cheaper than 75.81% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of SPSC indicates a somewhat cheap valuation: SPSC is cheaper than 75.09% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.03 | ||
| EV/EBITDA | 20.43 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of SPSC may justify a higher PE ratio.
- SPSC's earnings are expected to grow with 14.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.05
PEG (5Y)1.02
EPS Next 2Y15.4%
EPS Next 3Y14.87%
5. Dividend
5.1 Amount
- No dividends for SPSC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
SPS COMMERCE INC / SPSC FAQ
Can you provide the ChartMill fundamental rating for SPS COMMERCE INC?
ChartMill assigns a fundamental rating of 6 / 10 to SPSC.
What is the valuation status for SPSC stock?
ChartMill assigns a valuation rating of 5 / 10 to SPS COMMERCE INC (SPSC). This can be considered as Fairly Valued.
How profitable is SPS COMMERCE INC (SPSC) stock?
SPS COMMERCE INC (SPSC) has a profitability rating of 6 / 10.
What is the financial health of SPS COMMERCE INC (SPSC) stock?
The financial health rating of SPS COMMERCE INC (SPSC) is 7 / 10.
What is the earnings growth outlook for SPS COMMERCE INC?
The Earnings per Share (EPS) of SPS COMMERCE INC (SPSC) is expected to grow by 21.39% in the next year.