DESCARTES SYSTEMS GRP/THE (DSG.CA) Stock Fundamental Analysis
TSX:DSG • CA2499061083
91.78 CAD
+1.34 (+1.48%)
Last: Feb 20, 2026, 07:00 PM
We assign a fundamental rating of 7 out of 10 to DSG. DSG was compared to 69 industry peers in the Software industry. DSG has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. DSG is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings would make DSG suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
- DSG had positive earnings in the past year.
- DSG had a positive operating cash flow in the past year.
- Each year in the past 5 years DSG has been profitable.
- In the past 5 years DSG always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 8.54%, DSG belongs to the best of the industry, outperforming 84.06% of the companies in the same industry.
- DSG has a better Return On Equity (10.02%) than 76.81% of its industry peers.
- DSG has a better Return On Invested Capital (9.58%) than 81.16% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for DSG is below the industry average of 12.35%.
- The last Return On Invested Capital (9.58%) for DSG is above the 3 year average (8.86%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.54% | ||
| ROE | 10.02% | ||
| ROIC | 9.58% |
ROA(3y)8.11%
ROA(5y)7.3%
ROE(3y)9.67%
ROE(5y)8.67%
ROIC(3y)8.86%
ROIC(5y)7.93%
1.3 Margins
- DSG's Profit Margin of 22.10% is amongst the best of the industry. DSG outperforms 91.30% of its industry peers.
- In the last couple of years the Profit Margin of DSG has grown nicely.
- The Operating Margin of DSG (28.79%) is better than 94.20% of its industry peers.
- DSG's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 76.80%, DSG belongs to the top of the industry, outperforming 82.61% of the companies in the same industry.
- DSG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.79% | ||
| PM (TTM) | 22.1% | ||
| GM | 76.8% |
OM growth 3Y3.87%
OM growth 5Y11.08%
PM growth 3Y2.7%
PM growth 5Y14.15%
GM growth 3Y-0.17%
GM growth 5Y0.52%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DSG is destroying value.
- Compared to 1 year ago, DSG has more shares outstanding
- The number of shares outstanding for DSG has been increased compared to 5 years ago.
- There is no outstanding debt for DSG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- DSG has an Altman-Z score of 13.90. This indicates that DSG is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 13.90, DSG belongs to the top of the industry, outperforming 92.75% of the companies in the same industry.
- There is no outstanding debt for DSG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 13.9 |
ROIC/WACC0.93
WACC10.31%
2.3 Liquidity
- A Current Ratio of 1.83 indicates that DSG should not have too much problems paying its short term obligations.
- DSG has a Current ratio of 1.83. This is in the better half of the industry: DSG outperforms 65.22% of its industry peers.
- A Quick Ratio of 1.83 indicates that DSG should not have too much problems paying its short term obligations.
- DSG has a Quick ratio of 1.83. This is in the better half of the industry: DSG outperforms 65.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.83 | ||
| Quick Ratio | 1.83 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 11.32% over the past year.
- DSG shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 30.86% yearly.
- The Revenue has grown by 11.39% in the past year. This is quite good.
- The Revenue has been growing by 14.85% on average over the past years. This is quite good.
EPS 1Y (TTM)11.32%
EPS 3Y18.17%
EPS 5Y30.86%
EPS Q2Q%19.05%
Revenue 1Y (TTM)11.39%
Revenue growth 3Y15.3%
Revenue growth 5Y14.85%
Sales Q2Q%11.23%
3.2 Future
- Based on estimates for the next years, DSG will show a very strong growth in Earnings Per Share. The EPS will grow by 21.86% on average per year.
- DSG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.56% yearly.
EPS Next Y40.02%
EPS Next 2Y26.33%
EPS Next 3Y22.6%
EPS Next 5Y21.86%
Revenue Next Year10.8%
Revenue Next 2Y10.88%
Revenue Next 3Y10.9%
Revenue Next 5Y10.56%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
- Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 37.77, the valuation of DSG can be described as expensive.
- Based on the Price/Earnings ratio, DSG is valued a bit cheaper than 69.57% of the companies in the same industry.
- When comparing the Price/Earnings ratio of DSG to the average of the S&P500 Index (26.99), we can say DSG is valued slightly more expensively.
- Based on the Price/Forward Earnings ratio of 25.43, the valuation of DSG can be described as expensive.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of DSG indicates a somewhat cheap valuation: DSG is cheaper than 65.22% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 28.06. DSG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.77 | ||
| Fwd PE | 25.43 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, DSG is valued a bit cheaper than 60.87% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, DSG is valued a bit cheaper than 69.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.59 | ||
| EV/EBITDA | 18.73 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The excellent profitability rating of DSG may justify a higher PE ratio.
- DSG's earnings are expected to grow with 22.60% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.94
PEG (5Y)1.22
EPS Next 2Y26.33%
EPS Next 3Y22.6%
5. Dividend
5.1 Amount
- No dividends for DSG!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
TSX:DSG (2/20/2026, 7:00:00 PM)
91.78
+1.34 (+1.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)12-03 2025-12-03/amc
Earnings (Next)03-11 2026-03-11/amc
Inst Owners86.36%
Inst Owner ChangeN/A
Ins Owners0.21%
Ins Owner ChangeN/A
Market Cap7.89B
Revenue(TTM)703.71M
Net Income(TTM)155.53M
Analysts77.78
Price Target137.7 (50.03%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
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)1
Avg EPS beat(2)2.72%
Min EPS beat(2)-1.85%
Max EPS beat(2)7.29%
EPS beat(4)2
Avg EPS beat(4)-0.23%
Min EPS beat(4)-6.83%
Max EPS beat(4)7.29%
EPS beat(8)5
Avg EPS beat(8)0.38%
EPS beat(12)7
Avg EPS beat(12)0.32%
EPS beat(16)9
Avg EPS beat(16)0.57%
Revenue beat(2)2
Avg Revenue beat(2)0.98%
Min Revenue beat(2)0.67%
Max Revenue beat(2)1.29%
Revenue beat(4)2
Avg Revenue beat(4)-0.63%
Min Revenue beat(4)-2.69%
Max Revenue beat(4)1.29%
Revenue beat(8)5
Avg Revenue beat(8)0.18%
Revenue beat(12)8
Avg Revenue beat(12)0.02%
Revenue beat(16)11
Avg Revenue beat(16)0.39%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)1.67%
EPS NQ rev (3m)3.1%
EPS NY rev (1m)-3.64%
EPS NY rev (3m)26.25%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)0.61%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.77 | ||
| Fwd PE | 25.43 | ||
| P/S | 8.19 | ||
| P/FCF | 23.59 | ||
| P/OCF | 22.99 | ||
| P/B | 3.71 | ||
| P/tB | 31.24 | ||
| EV/EBITDA | 18.73 |
EPS(TTM)2.43
EY2.65%
EPS(NY)3.61
Fwd EY3.93%
FCF(TTM)3.89
FCFY4.24%
OCF(TTM)3.99
OCFY4.35%
SpS11.21
BVpS24.72
TBVpS2.94
PEG (NY)0.94
PEG (5Y)1.22
Graham Number36.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.54% | ||
| ROE | 10.02% | ||
| ROCE | 12.65% | ||
| ROIC | 9.58% | ||
| ROICexc | 11.59% | ||
| ROICexgc | N/A | ||
| OM | 28.79% | ||
| PM (TTM) | 22.1% | ||
| GM | 76.8% | ||
| FCFM | 34.7% |
ROA(3y)8.11%
ROA(5y)7.3%
ROE(3y)9.67%
ROE(5y)8.67%
ROIC(3y)8.86%
ROIC(5y)7.93%
ROICexc(3y)11.36%
ROICexc(5y)9.99%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)11.7%
ROCE(5y)10.48%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y6.45%
ROICexc growth 5Y18.03%
OM growth 3Y3.87%
OM growth 5Y11.08%
PM growth 3Y2.7%
PM growth 5Y14.15%
GM growth 3Y-0.17%
GM growth 5Y0.52%
F-Score6
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 7.46% | ||
| Cap/Sales | 0.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.93% | ||
| Profit Quality | 157% | ||
| Current Ratio | 1.83 | ||
| Quick Ratio | 1.83 | ||
| Altman-Z | 13.9 |
F-Score6
WACC10.31%
ROIC/WACC0.93
Cap/Depr(3y)8.9%
Cap/Depr(5y)8.08%
Cap/Sales(3y)1.09%
Cap/Sales(5y)1.1%
Profit Quality(3y)168.32%
Profit Quality(5y)189.61%
High Growth Momentum
Growth
EPS 1Y (TTM)11.32%
EPS 3Y18.17%
EPS 5Y30.86%
EPS Q2Q%19.05%
EPS Next Y40.02%
EPS Next 2Y26.33%
EPS Next 3Y22.6%
EPS Next 5Y21.86%
Revenue 1Y (TTM)11.39%
Revenue growth 3Y15.3%
Revenue growth 5Y14.85%
Sales Q2Q%11.23%
Revenue Next Year10.8%
Revenue Next 2Y10.88%
Revenue Next 3Y10.9%
Revenue Next 5Y10.56%
EBIT growth 1Y21.35%
EBIT growth 3Y19.76%
EBIT growth 5Y27.58%
EBIT Next Year75.09%
EBIT Next 3Y30.66%
EBIT Next 5Y23.12%
FCF growth 1Y21.44%
FCF growth 3Y7.45%
FCF growth 5Y16.41%
OCF growth 1Y20.72%
OCF growth 3Y7.57%
OCF growth 5Y16.02%
DESCARTES SYSTEMS GRP/THE / DSG.CA FAQ
What is the fundamental rating for DSG stock?
ChartMill assigns a fundamental rating of 7 / 10 to DSG.CA.
What is the valuation status for DSG stock?
ChartMill assigns a valuation rating of 5 / 10 to DESCARTES SYSTEMS GRP/THE (DSG.CA). This can be considered as Fairly Valued.
How profitable is DESCARTES SYSTEMS GRP/THE (DSG.CA) stock?
DESCARTES SYSTEMS GRP/THE (DSG.CA) has a profitability rating of 8 / 10.
What are the PE and PB ratios of DESCARTES SYSTEMS GRP/THE (DSG.CA) stock?
The Price/Earnings (PE) ratio for DESCARTES SYSTEMS GRP/THE (DSG.CA) is 37.77 and the Price/Book (PB) ratio is 3.71.
Can you provide the expected EPS growth for DSG stock?
The Earnings per Share (EPS) of DESCARTES SYSTEMS GRP/THE (DSG.CA) is expected to grow by 40.02% in the next year.