SS&C TECHNOLOGIES HOLDINGS (SSNC) Stock Fundamental Analysis
NASDAQ:SSNC - Nasdaq - US78467J1007 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to SSNC. SSNC was compared to 82 industry peers in the IT Services industry. SSNC has an excellent profitability rating, but there are concerns on its financial health. SSNC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
SSNC had positive earnings in the past year.
In the past year SSNC had a positive cash flow from operations.
SSNC had positive earnings in each of the past 5 years.
SSNC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
SSNC has a Return On Assets of 4.00%. This is in the better half of the industry: SSNC outperforms 62.20% of its industry peers.
Looking at the Return On Equity, with a value of 12.02%, SSNC is in the better half of the industry, outperforming 69.51% of the companies in the same industry.
The Return On Invested Capital of SSNC (7.24%) is better than 63.41% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SSNC is significantly below the industry average of 21.60%.
The 3 year average ROIC (6.63%) for SSNC is below the current ROIC(7.24%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4% | ||
| ROE | 12.02% | ||
| ROIC | 7.24% |
ROA(3y)3.75%
ROA(5y)3.96%
ROE(3y)10.66%
ROE(5y)11.18%
ROIC(3y)6.63%
ROIC(5y)6.55%
1.3 Margins
Looking at the Profit Margin, with a value of 13.69%, SSNC belongs to the top of the industry, outperforming 90.24% of the companies in the same industry.
In the last couple of years the Profit Margin of SSNC has grown nicely.
With an excellent Operating Margin value of 22.96%, SSNC belongs to the best of the industry, outperforming 96.34% of the companies in the same industry.
In the last couple of years the Operating Margin of SSNC has grown nicely.
SSNC's Gross Margin of 48.71% is fine compared to the rest of the industry. SSNC outperforms 67.07% of its industry peers.
In the last couple of years the Gross Margin of SSNC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.96% | ||
| PM (TTM) | 13.69% | ||
| GM | 48.71% |
OM growth 3Y-2.44%
OM growth 5Y2.96%
PM growth 3Y-6.54%
PM growth 5Y6.44%
GM growth 3Y0.68%
GM growth 5Y2.22%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so SSNC is destroying value.
SSNC has less shares outstanding than it did 1 year ago.
The number of shares outstanding for SSNC has been reduced compared to 5 years ago.
Compared to 1 year ago, SSNC has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.71, we must say that SSNC is in the distress zone and has some risk of bankruptcy.
SSNC has a worse Altman-Z score (1.71) than 65.85% of its industry peers.
The Debt to FCF ratio of SSNC is 5.62, which is a neutral value as it means it would take SSNC, 5.62 years of fcf income to pay off all of its debts.
SSNC has a Debt to FCF ratio of 5.62. This is comparable to the rest of the industry: SSNC outperforms 52.44% of its industry peers.
A Debt/Equity ratio of 1.01 is on the high side and indicates that SSNC has dependencies on debt financing.
The Debt to Equity ratio of SSNC (1.01) is worse than 69.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 5.62 | ||
| Altman-Z | 1.71 |
ROIC/WACC0.78
WACC9.31%
2.3 Liquidity
SSNC has a Current Ratio of 1.11. This is a normal value and indicates that SSNC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.11, SSNC is doing worse than 71.95% of the companies in the same industry.
SSNC has a Quick Ratio of 1.11. This is a normal value and indicates that SSNC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.11, SSNC is doing worse than 70.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
SSNC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.49%, which is quite good.
SSNC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.19% yearly.
Looking at the last year, SSNC shows a small growth in Revenue. The Revenue has grown by 6.92% in the last year.
The Revenue has been growing slightly by 4.89% on average over the past years.
EPS 1Y (TTM)16.49%
EPS 3Y2.59%
EPS 5Y7.19%
EPS Q2Q%12.5%
Revenue 1Y (TTM)6.92%
Revenue growth 3Y5.21%
Revenue growth 5Y4.89%
Sales Q2Q%5.5%
3.2 Future
SSNC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.64% yearly.
Based on estimates for the next years, SSNC will show a small growth in Revenue. The Revenue will grow by 5.28% on average per year.
EPS Next Y10.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
EPS Next 5Y5.64%
Revenue Next Year5.98%
Revenue Next 2Y5.47%
Revenue Next 3Y5%
Revenue Next 5Y5.28%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 14.95, SSNC is valued correctly.
76.83% of the companies in the same industry are more expensive than SSNC, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.50, SSNC is valued a bit cheaper.
SSNC is valuated correctly with a Price/Forward Earnings ratio of 12.67.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SSNC indicates a rather cheap valuation: SSNC is cheaper than 81.71% of the companies listed in the same industry.
SSNC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 36.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 12.67 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SSNC indicates a somewhat cheap valuation: SSNC is cheaper than 69.51% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, SSNC is valued a bit cheaper than the industry average as 78.05% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.85 | ||
| EV/EBITDA | 13.09 |
4.3 Compensation for Growth
SSNC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
SSNC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.46
PEG (5Y)2.08
EPS Next 2Y10.23%
EPS Next 3Y9.31%
5. Dividend
5.1 Amount
SSNC has a Yearly Dividend Yield of 1.20%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.46, SSNC pays a better dividend. On top of this SSNC pays more dividend than 81.71% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, SSNC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.2% |
5.2 History
The dividend of SSNC is nicely growing with an annual growth rate of 18.56%!
SSNC has been paying a dividend for at least 10 years, so it has a reliable track record.
SSNC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)18.56%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
30.25% of the earnings are spent on dividend by SSNC. This is a low number and sustainable payout ratio.
SSNC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP30.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
83.41
+0.15 (+0.18%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners85.2%
Inst Owner Change0.12%
Ins Owners14.39%
Ins Owner Change0.28%
Market Cap20.57B
Analysts83.53
Price Target95.59 (14.6%)
Short Float %1.96%
Short Ratio3.5
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.2% |
Yearly Dividend1
Dividend Growth(5Y)18.56%
DP30.25%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.71%
Min EPS beat(2)0.42%
Max EPS beat(2)16.99%
EPS beat(4)4
Avg EPS beat(4)5.48%
Min EPS beat(4)0.42%
Max EPS beat(4)16.99%
EPS beat(8)5
Avg EPS beat(8)2.15%
EPS beat(12)5
Avg EPS beat(12)-0.23%
EPS beat(16)8
Avg EPS beat(16)0.76%
Revenue beat(2)1
Avg Revenue beat(2)-0.1%
Min Revenue beat(2)-1.31%
Max Revenue beat(2)1.1%
Revenue beat(4)1
Avg Revenue beat(4)-0.3%
Min Revenue beat(4)-1.31%
Max Revenue beat(4)1.1%
Revenue beat(8)1
Avg Revenue beat(8)-0.82%
Revenue beat(12)1
Avg Revenue beat(12)-1.35%
Revenue beat(16)4
Avg Revenue beat(16)-0.89%
PT rev (1m)0%
PT rev (3m)-3.5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.25%
EPS NY rev (1m)0.1%
EPS NY rev (3m)0.22%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.21%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 12.67 | ||
| P/S | 3.45 | ||
| P/FCF | 16.85 | ||
| P/OCF | 13.9 | ||
| P/B | 3.03 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.09 |
EPS(TTM)5.58
EY6.69%
EPS(NY)6.59
Fwd EY7.9%
FCF(TTM)4.95
FCFY5.93%
OCF(TTM)6
OCFY7.2%
SpS24.17
BVpS27.51
TBVpS-25.42
PEG (NY)1.46
PEG (5Y)2.08
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4% | ||
| ROE | 12.02% | ||
| ROCE | 9.27% | ||
| ROIC | 7.24% | ||
| ROICexc | 7.5% | ||
| ROICexgc | 89.27% | ||
| OM | 22.96% | ||
| PM (TTM) | 13.69% | ||
| GM | 48.71% | ||
| FCFM | 20.48% |
ROA(3y)3.75%
ROA(5y)3.96%
ROE(3y)10.66%
ROE(5y)11.18%
ROIC(3y)6.63%
ROIC(5y)6.55%
ROICexc(3y)6.86%
ROICexc(5y)6.77%
ROICexgc(3y)94.96%
ROICexgc(5y)89.67%
ROCE(3y)8.49%
ROCE(5y)8.39%
ROICexcg growth 3Y3.29%
ROICexcg growth 5Y10.46%
ROICexc growth 3Y-0.36%
ROICexc growth 5Y7.52%
OM growth 3Y-2.44%
OM growth 5Y2.96%
PM growth 3Y-6.54%
PM growth 5Y6.44%
GM growth 3Y0.68%
GM growth 5Y2.22%
F-Score6
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 5.62 | ||
| Debt/EBITDA | 3.33 | ||
| Cap/Depr | 37.88% | ||
| Cap/Sales | 4.36% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 72.07% | ||
| Profit Quality | 149.61% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 1.71 |
F-Score6
WACC9.31%
ROIC/WACC0.78
Cap/Depr(3y)35.38%
Cap/Depr(5y)28.25%
Cap/Sales(3y)4.29%
Cap/Sales(5y)3.57%
Profit Quality(3y)150.04%
Profit Quality(5y)156.83%
High Growth Momentum
Growth
EPS 1Y (TTM)16.49%
EPS 3Y2.59%
EPS 5Y7.19%
EPS Q2Q%12.5%
EPS Next Y10.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
EPS Next 5Y5.64%
Revenue 1Y (TTM)6.92%
Revenue growth 3Y5.21%
Revenue growth 5Y4.89%
Sales Q2Q%5.5%
Revenue Next Year5.98%
Revenue Next 2Y5.47%
Revenue Next 3Y5%
Revenue Next 5Y5.28%
EBIT growth 1Y8.46%
EBIT growth 3Y2.64%
EBIT growth 5Y8%
EBIT Next Year10.33%
EBIT Next 3Y7.55%
EBIT Next 5Y6.97%
FCF growth 1Y24.59%
FCF growth 3Y-4.3%
FCF growth 5Y-1.11%
OCF growth 1Y22.79%
OCF growth 3Y-0.95%
OCF growth 5Y0.89%