POWERSCHOOL HOLDINGS INC-A (PWSC)
US73939C1062 - Common Stock
We assign a fundamental rating of 3 out of 10 to PWSC. PWSC was compared to 277 industry peers in the Software industry. While PWSC is still in line with the averages on profitability rating, there are concerns on its financial health. PWSC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
PWSC had positive earnings in the past year.
PWSC had a positive operating cash flow in the past year.
In the past 5 years PWSC always reported negative net income.
Each year in the past 5 years PWSC had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of -1.03%, PWSC is in the better half of the industry, outperforming 62.55% of the companies in the same industry.
Looking at the Return On Equity, with a value of -3.01%, PWSC is in the better half of the industry, outperforming 64.36% of the companies in the same industry.
With a decent Return On Invested Capital value of 0.78%, PWSC is doing good in the industry, outperforming 67.64% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for PWSC is significantly below the industry average of 10.02%.
The last Return On Invested Capital (0.78%) for PWSC is above the 3 year average (0.41%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.03% | ||
| ROE | -3.01% | ||
| ROIC | 0.78% |
ROA(3y)-0.79%
ROA(5y)-1.33%
ROE(3y)-2.27%
ROE(5y)-2.97%
ROIC(3y)0.41%
ROIC(5y)N/A
1.3 Margins
PWSC has a better Operating Margin (4.58%) than 71.27% of its industry peers.
PWSC's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 59.31%, PWSC is not doing good in the industry: 60.73% of the companies in the same industry are doing better.
PWSC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.58% | ||
| PM (TTM) | N/A | ||
| GM | 59.31% |
OM growth 3Y-10.66%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.99%
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PWSC is destroying value.
Compared to 1 year ago, PWSC has more shares outstanding
Compared to 1 year ago, PWSC has a worse debt to assets ratio.
2.2 Solvency
PWSC has an Altman-Z score of 1.05. This is a bad value and indicates that PWSC is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of PWSC (1.05) is worse than 62.55% of its industry peers.
PWSC has a debt to FCF ratio of 9.72. This is a negative value and a sign of low solvency as PWSC would need 9.72 years to pay back of all of its debts.
The Debt to FCF ratio of PWSC (9.72) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.72 indicates that PWSC is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.72, PWSC is not doing good in the industry: 70.55% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.72 | ||
| Debt/FCF | 9.72 | ||
| Altman-Z | 1.05 |
ROIC/WACC0.07
WACC10.54%
2.3 Liquidity
A Current Ratio of 0.24 indicates that PWSC may have some problems paying its short term obligations.
PWSC's Current ratio of 0.24 is on the low side compared to the rest of the industry. PWSC is outperformed by 97.09% of its industry peers.
A Quick Ratio of 0.24 indicates that PWSC may have some problems paying its short term obligations.
With a Quick ratio value of 0.24, PWSC is not doing good in the industry: 97.09% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.24 | ||
| Quick Ratio | 0.24 |
3. Growth
3.1 Past
The earnings per share for PWSC have decreased by -7.95% in the last year.
The Revenue has grown by 12.89% in the past year. This is quite good.
PWSC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.06% yearly.
EPS 1Y (TTM)-7.95%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-5.56%
Revenue 1Y (TTM)12.89%
Revenue growth 3Y17.06%
Revenue growth 5YN/A
Sales Q2Q%16%
3.2 Future
PWSC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.96% yearly.
Based on estimates for the next years, PWSC will show a quite strong growth in Revenue. The Revenue will grow by 11.52% on average per year.
EPS Next Y14.52%
EPS Next 2Y18.26%
EPS Next 3Y15.96%
EPS Next 5YN/A
Revenue Next Year12.92%
Revenue Next 2Y11.75%
Revenue Next 3Y11.52%
Revenue Next 5YN/A
3.3 Evolution
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
Based on the Price/Earnings ratio of 26.47, the valuation of PWSC can be described as expensive.
PWSC's Price/Earnings ratio is a bit cheaper when compared to the industry. PWSC is cheaper than 74.91% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.05. PWSC is around the same levels.
PWSC is valuated rather expensively with a Price/Forward Earnings ratio of 18.70.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PWSC indicates a rather cheap valuation: PWSC is cheaper than 80.73% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of PWSC to the average of the S&P500 Index (20.07), we can say PWSC is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.47 | ||
| Fwd PE | 18.7 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PWSC indicates a somewhat cheap valuation: PWSC is cheaper than 76.36% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PWSC indicates a somewhat cheap valuation: PWSC is cheaper than 60.73% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.96 | ||
| EV/EBITDA | 30.37 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PWSC's earnings are expected to grow with 15.96% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.82
PEG (5Y)N/A
EPS Next 2Y18.26%
EPS Next 3Y15.96%
5. Dividend
5.1 Amount
PWSC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
POWERSCHOOL HOLDINGS INC-A
NYSE:PWSC (5/31/2024, 7:04:01 PM)
After market: 21.44 0 (0%)21.44
+0.26 (+1.23%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap4.37B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
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Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.47 | ||
| Fwd PE | 18.7 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.82
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.03% | ||
| ROE | -3.01% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 4.58% | ||
| PM (TTM) | N/A | ||
| GM | 59.31% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.72 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.24 | ||
| Quick Ratio | 0.24 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-7.95%
EPS 3YN/A
EPS 5Y
EPS Q2Q%
EPS Next Y14.52%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.89%
Revenue growth 3Y17.06%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y