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STEPSTONE GROUP INC-CLASS A (STEP) Stock Fundamental Analysis

NASDAQ:STEP - Nasdaq - US85914M1071 - Common Stock - Currency: USD

50.28  +2.01 (+4.16%)

After market: 50.28 0 (0%)

Fundamental Rating

5

Taking everything into account, STEP scores 5 out of 10 in our fundamental rating. STEP was compared to 227 industry peers in the Capital Markets industry. STEP scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. STEP shows excellent growth, but is valued quite expensive already.


Dividend Valuation Growth Profitability Health

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3

1. Profitability

1.1 Basic Checks

In the past year STEP was profitable.
In the past year STEP had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: STEP reported negative net income in multiple years.
In the past 5 years STEP always reported a positive cash flow from operatings.
STEP Yearly Net Income VS EBIT VS OCF VS FCFSTEP Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M 300M 400M

1.2 Ratios

STEP has a worse Return On Assets (-2.99%) than 80.62% of its industry peers.
STEP has a Return On Equity of -62.06%. This is amonst the worse of the industry: STEP underperforms 86.78% of its industry peers.
Industry RankSector Rank
ROA -2.99%
ROE -62.06%
ROIC N/A
ROA(3y)1.88%
ROA(5y)2.08%
ROE(3y)13.08%
ROE(5y)12.87%
ROIC(3y)N/A
ROIC(5y)N/A
STEP Yearly ROA, ROE, ROICSTEP Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60

1.3 Margins

STEP's Profit Margin has been stable in the last couple of years.
In the last couple of years the Operating Margin of STEP has declined.
Looking at the Gross Margin, with a value of 87.59%, STEP belongs to the top of the industry, outperforming 91.19% of the companies in the same industry.
In the last couple of years the Gross Margin of STEP has remained more or less at the same level.
The Profit Margin and Operating Margin are not available for STEP so they could not be analyzed.
Industry RankSector Rank
OM N/A
PM (TTM) N/A
GM 87.59%
OM growth 3Y-16.12%
OM growth 5Y-1.61%
PM growth 3Y0.82%
PM growth 5YN/A
GM growth 3Y6.94%
GM growth 5Y-0.81%
STEP Yearly Profit, Operating, Gross MarginsSTEP Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2017 2018 2019 2020 2021 2022 2023 2024 0 50 100 150 200

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4

2. Health

2.1 Basic Checks

Compared to 1 year ago, STEP has more shares outstanding
Compared to 5 years ago, STEP has more shares outstanding
Compared to 1 year ago, STEP has a worse debt to assets ratio.
STEP Yearly Shares OutstandingSTEP Yearly Shares OutstandingYearly Shares Outstanding 2018 2019 2020 2021 2022 2023 2024 20M 40M 60M
STEP Yearly Total Debt VS Total AssetsSTEP Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.2 Solvency

Based on the Altman-Z score of 0.90, we must say that STEP is in the distress zone and has some risk of bankruptcy.
STEP's Altman-Z score of 0.90 is in line compared to the rest of the industry. STEP outperforms 51.54% of its industry peers.
The Debt to FCF ratio of STEP is 1.24, which is an excellent value as it means it would take STEP, only 1.24 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.24, STEP belongs to the top of the industry, outperforming 85.90% of the companies in the same industry.
A Debt/Equity ratio of 0.81 indicates that STEP is somewhat dependend on debt financing.
STEP has a Debt to Equity ratio of 0.81. This is in the better half of the industry: STEP outperforms 60.35% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.81
Debt/FCF 1.24
Altman-Z 0.9
ROIC/WACCN/A
WACCN/A
STEP Yearly LT Debt VS Equity VS FCFSTEP Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M 800M

2.3 Liquidity

A Current Ratio of 1.04 indicates that STEP should not have too much problems paying its short term obligations.
The Current ratio of STEP (1.04) is comparable to the rest of the industry.
STEP has a Quick Ratio of 1.04. This is a normal value and indicates that STEP is financially healthy and should not expect problems in meeting its short term obligations.
STEP's Quick ratio of 1.04 is in line compared to the rest of the industry. STEP outperforms 49.78% of its industry peers.
Industry RankSector Rank
Current Ratio 1.04
Quick Ratio 1.04
STEP Yearly Current Assets VS Current LiabilitesSTEP Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B 2.5B

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9

3. Growth

3.1 Past

STEP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 50.44%, which is quite impressive.
Measured over the past years, STEP shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -22.65% on average per year.
Looking at the last year, STEP shows a very strong growth in Revenue. The Revenue has grown by 117.42%.
Measured over the past years, STEP shows a very strong growth in Revenue. The Revenue has been growing by 22.56% on average per year.
EPS 1Y (TTM)50.44%
EPS 3Y-22.65%
EPS 5YN/A
EPS Q2Q%18.92%
Revenue 1Y (TTM)117.42%
Revenue growth 3Y-3.25%
Revenue growth 5Y22.56%
Sales Q2Q%123.79%

3.2 Future

Based on estimates for the next years, STEP will show a very strong growth in Earnings Per Share. The EPS will grow by 23.58% on average per year.
Based on estimates for the next years, STEP will show a very strong growth in Revenue. The Revenue will grow by 25.97% on average per year.
EPS Next Y52.18%
EPS Next 2Y26.33%
EPS Next 3Y23.58%
EPS Next 5YN/A
Revenue Next Year39.88%
Revenue Next 2Y29.6%
Revenue Next 3Y25.97%
Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
STEP Yearly Revenue VS EstimatesSTEP Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 500M 1B
STEP Yearly EPS VS EstimatesSTEP Yearly EPS VS EstimatesYearly EPS VS Estimates 2021 2022 2023 2024 2025 2026 2027 0.5 1 1.5 2

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3

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 29.58, the valuation of STEP can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of STEP indicates a slightly more expensive valuation: STEP is more expensive than 71.37% of the companies listed in the same industry.
STEP is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.92, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 25.82, STEP can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of STEP indicates a slightly more expensive valuation: STEP is more expensive than 66.08% of the companies listed in the same industry.
STEP's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.65.
Industry RankSector Rank
PE 29.58
Fwd PE 25.82
STEP Price Earnings VS Forward Price EarningsSTEP Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

STEP's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 42.96
EV/EBITDA N/A
STEP Per share dataSTEP EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5

4.3 Compensation for Growth

STEP'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 STEP's earnings are expected to grow with 23.58% in the coming years.
PEG (NY)0.57
PEG (5Y)N/A
EPS Next 2Y26.33%
EPS Next 3Y23.58%

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2

5. Dividend

5.1 Amount

STEP has a Yearly Dividend Yield of 2.04%. Purely for dividend investing, there may be better candidates out there.
The stock price of STEP dropped by -21.94% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 8.41, STEP is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.51, STEP has a dividend comparable with the average S&P500 company.
Industry RankSector Rank
Dividend Yield 2.04%

5.2 History

STEP has been paying a dividend for over 5 years, so it has already some track record.
STEP has decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years2
Div Non Decr Years2
STEP Yearly Dividends per shareSTEP Yearly Dividends per shareYearly Dividends per share 2021 2022 2023 2024 2025 0.2 0.4 0.6 0.8 1

5.3 Sustainability

STEP has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-54.57%
EPS Next 2Y26.33%
EPS Next 3Y23.58%
STEP Yearly Income VS Free CF VS DividendSTEP Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2017 2018 2019 2020 2021 2022 2023 2024 0 50M 100M 150M 200M

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STEPSTONE GROUP INC-CLASS A

NASDAQ:STEP (4/24/2025, 8:00:00 PM)

After market: 50.28 0 (0%)

50.28

+2.01 (+4.16%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)02-06 2025-02-06/amc
Earnings (Next)05-21 2025-05-21/amc
Inst Owners92.03%
Inst Owner Change0.12%
Ins Owners16.7%
Ins Owner Change0.5%
Market Cap5.83B
Analysts76.92
Price Target69.36 (37.95%)
Short Float %3.89%
Short Ratio4.41
Dividend
Industry RankSector Rank
Dividend Yield 2.04%
Yearly Dividend1.07
Dividend Growth(5Y)N/A
DP-54.57%
Div Incr Years2
Div Non Decr Years2
Ex-Date02-28 2025-02-28 (0.24)
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.48%
Min EPS beat(2)-5.06%
Max EPS beat(2)-3.9%
EPS beat(4)2
Avg EPS beat(4)9.87%
Min EPS beat(4)-5.06%
Max EPS beat(4)33.36%
EPS beat(8)3
Avg EPS beat(8)5.94%
EPS beat(12)5
Avg EPS beat(12)5.57%
EPS beat(16)9
Avg EPS beat(16)15.15%
Revenue beat(2)2
Avg Revenue beat(2)36.8%
Min Revenue beat(2)26.51%
Max Revenue beat(2)47.09%
Revenue beat(4)3
Avg Revenue beat(4)21.47%
Min Revenue beat(4)-7.43%
Max Revenue beat(4)47.09%
Revenue beat(8)3
Avg Revenue beat(8)8.61%
Revenue beat(12)4
Avg Revenue beat(12)-22.63%
Revenue beat(16)8
Avg Revenue beat(16)38.02%
PT rev (1m)-3.32%
PT rev (3m)-3.94%
EPS NQ rev (1m)-3.22%
EPS NQ rev (3m)-5.41%
EPS NY rev (1m)-1.4%
EPS NY rev (3m)-1.64%
Revenue NQ rev (1m)1.75%
Revenue NQ rev (3m)0.68%
Revenue NY rev (1m)1.09%
Revenue NY rev (3m)2.31%
Valuation
Industry RankSector Rank
PE 29.58
Fwd PE 25.82
P/S 5.03
P/FCF 42.96
P/OCF 41.93
P/B 27.79
P/tB N/A
EV/EBITDA N/A
EPS(TTM)1.7
EY3.38%
EPS(NY)1.95
Fwd EY3.87%
FCF(TTM)1.17
FCFY2.33%
OCF(TTM)1.2
OCFY2.38%
SpS10
BVpS1.81
TBVpS-5.56
PEG (NY)0.57
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -2.99%
ROE -62.06%
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) N/A
GM 87.59%
FCFM 11.7%
ROA(3y)1.88%
ROA(5y)2.08%
ROE(3y)13.08%
ROE(5y)12.87%
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)10.99%
ROCE(5y)24.52%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y-16.12%
OM growth 5Y-1.61%
PM growth 3Y0.82%
PM growth 5YN/A
GM growth 3Y6.94%
GM growth 5Y-0.81%
F-Score3
Asset Turnover0.27
Health
Industry RankSector Rank
Debt/Equity 0.81
Debt/FCF 1.24
Debt/EBITDA N/A
Cap/Depr 7.36%
Cap/Sales 0.29%
Interest Coverage N/A
Cash Conversion N/A
Profit Quality N/A
Current Ratio 1.04
Quick Ratio 1.04
Altman-Z 0.9
F-Score3
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)20.26%
Cap/Depr(5y)19.14%
Cap/Sales(3y)3.97%
Cap/Sales(5y)2.45%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)50.44%
EPS 3Y-22.65%
EPS 5YN/A
EPS Q2Q%18.92%
EPS Next Y52.18%
EPS Next 2Y26.33%
EPS Next 3Y23.58%
EPS Next 5YN/A
Revenue 1Y (TTM)117.42%
Revenue growth 3Y-3.25%
Revenue growth 5Y22.56%
Sales Q2Q%123.79%
Revenue Next Year39.88%
Revenue Next 2Y29.6%
Revenue Next 3Y25.97%
Revenue Next 5YN/A
EBIT growth 1Y-209.84%
EBIT growth 3Y-18.85%
EBIT growth 5Y20.59%
EBIT Next Year88.65%
EBIT Next 3Y36.72%
EBIT Next 5YN/A
FCF growth 1Y-24.76%
FCF growth 3Y-1.39%
FCF growth 5Y23.95%
OCF growth 1Y-24.41%
OCF growth 3Y2.66%
OCF growth 5Y25.69%