EPAM SYSTEMS INC (EPAM) Stock Fundamental Analysis
USA - NYSE:EPAM - US29414B1044 - Common Stock
180.16 USD
-2.24 (-1.23%)
180.16 USD
0 (0%)
EPAM gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 84 industry peers in the IT Services industry. EPAM is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. EPAM has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
EPAM had positive earnings in the past year.
EPAM had a positive operating cash flow in the past year.
In the past 5 years EPAM has always been profitable.
Each year in the past 5 years EPAM had a positive operating cash flow.
1.2 Ratios
EPAM's Return On Assets of 7.67% is fine compared to the rest of the industry. EPAM outperforms 77.38% of its industry peers.
With a decent Return On Equity value of 9.97%, EPAM is doing good in the industry, outperforming 64.29% of the companies in the same industry.
The Return On Invested Capital of EPAM (10.71%) is better than 75.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for EPAM is significantly below the industry average of 28.66%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 9.97% | ||
| ROIC | 10.72% |
ROA(3y)9.87%
ROA(5y)11.06%
ROE(3y)12.84%
ROE(5y)14.88%
ROIC(3y)11.98%
ROIC(5y)12.84%
1.3 Margins
EPAM's Profit Margin of 7.01% is fine compared to the rest of the industry. EPAM outperforms 71.43% of its industry peers.
EPAM's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 10.43%, EPAM is in the better half of the industry, outperforming 70.24% of the companies in the same industry.
In the last couple of years the Operating Margin of EPAM has declined.
EPAM has a worse Gross Margin (28.92%) than 63.10% of its industry peers.
In the last couple of years the Gross Margin of EPAM has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.43% | ||
| PM (TTM) | 7.01% | ||
| GM | 28.92% |
OM growth 3Y-7.24%
OM growth 5Y-2.7%
PM growth 3Y-9.14%
PM growth 5Y-3.32%
GM growth 3Y-3.28%
GM growth 5Y-2.67%
2. Health
2.1 Basic Checks
EPAM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
EPAM has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, EPAM has more shares outstanding
The debt/assets ratio for EPAM has been reduced compared to a year ago.
2.2 Solvency
EPAM has an Altman-Z score of 8.03. This indicates that EPAM is financially healthy and has little risk of bankruptcy at the moment.
EPAM has a better Altman-Z score (8.03) than 85.71% of its industry peers.
The Debt to FCF ratio of EPAM is 0.05, which is an excellent value as it means it would take EPAM, only 0.05 years of fcf income to pay off all of its debts.
EPAM has a Debt to FCF ratio of 0.05. This is amongst the best in the industry. EPAM outperforms 94.05% of its industry peers.
A Debt/Equity ratio of 0.01 indicates that EPAM is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.01, EPAM belongs to the top of the industry, outperforming 80.95% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Altman-Z | 8.03 |
ROIC/WACC1.21
WACC8.84%
2.3 Liquidity
A Current Ratio of 3.02 indicates that EPAM has no problem at all paying its short term obligations.
EPAM's Current ratio of 3.02 is amongst the best of the industry. EPAM outperforms 80.95% of its industry peers.
EPAM has a Quick Ratio of 3.02. This indicates that EPAM is financially healthy and has no problem in meeting its short term obligations.
With an excellent Quick ratio value of 3.02, EPAM belongs to the best of the industry, outperforming 80.95% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.02 | ||
| Quick Ratio | 3.02 |
3. Growth
3.1 Past
EPAM shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.97%.
The Earnings Per Share has been growing by 14.89% on average over the past years. This is quite good.
EPAM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.26%.
EPAM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.56% yearly.
EPS 1Y (TTM)2.97%
EPS 3Y6.34%
EPS 5Y14.89%
EPS Q2Q%-1.28%
Revenue 1Y (TTM)14.26%
Revenue growth 3Y7.95%
Revenue growth 5Y15.56%
Sales Q2Q%19.43%
3.2 Future
The Earnings Per Share is expected to grow by 4.56% on average over the next years.
The Revenue is expected to grow by 7.65% on average over the next years.
EPS Next Y4.42%
EPS Next 2Y6.78%
EPS Next 3Y8.14%
EPS Next 5Y4.56%
Revenue Next Year15.23%
Revenue Next 2Y11.14%
Revenue Next 3Y10.23%
Revenue Next 5Y7.65%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.23, which indicates a correct valuation of EPAM.
Based on the Price/Earnings ratio, EPAM is valued a bit cheaper than the industry average as 72.62% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 26.35, EPAM is valued a bit cheaper.
The Price/Forward Earnings ratio is 14.54, which indicates a correct valuation of EPAM.
Based on the Price/Forward Earnings ratio, EPAM is valued a bit cheaper than 76.19% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 33.72. EPAM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.23 | ||
| Fwd PE | 14.54 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EPAM indicates a somewhat cheap valuation: EPAM is cheaper than 65.48% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of EPAM indicates a somewhat cheap valuation: EPAM is cheaper than 61.90% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.86 | ||
| EV/EBITDA | 13.87 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)3.67
PEG (5Y)1.09
EPS Next 2Y6.78%
EPS Next 3Y8.14%
5. Dividend
5.1 Amount
EPAM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
180.16
-2.24 (-1.23%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners96.48%
Inst Owner Change-0.36%
Ins Owners3.6%
Ins Owner Change0.07%
Market Cap10.03B
Revenue(TTM)5.30B
Net Income(TTM)371.62M
Analysts80
Price Target209.37 (16.21%)
Short Float %3.68%
Short Ratio2.64
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)1.91%
Min EPS beat(2)-0.24%
Max EPS beat(2)4.07%
EPS beat(4)3
Avg EPS beat(4)2.22%
Min EPS beat(4)-0.24%
Max EPS beat(4)4.07%
EPS beat(8)7
Avg EPS beat(8)5.06%
EPS beat(12)11
Avg EPS beat(12)5.54%
EPS beat(16)15
Avg EPS beat(16)10.49%
Revenue beat(2)0
Avg Revenue beat(2)-0.55%
Min Revenue beat(2)-0.61%
Max Revenue beat(2)-0.48%
Revenue beat(4)1
Avg Revenue beat(4)-0.2%
Min Revenue beat(4)-0.61%
Max Revenue beat(4)0.84%
Revenue beat(8)1
Avg Revenue beat(8)-0.58%
Revenue beat(12)1
Avg Revenue beat(12)-0.88%
Revenue beat(16)4
Avg Revenue beat(16)0.18%
PT rev (1m)-4%
PT rev (3m)-5.59%
EPS NQ rev (1m)0%
EPS NQ rev (3m)4.78%
EPS NY rev (1m)0.5%
EPS NY rev (3m)2.62%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)1.67%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)0.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.23 | ||
| Fwd PE | 14.54 | ||
| P/S | 1.89 | ||
| P/FCF | 21.86 | ||
| P/OCF | 19.98 | ||
| P/B | 2.69 | ||
| P/tB | 4.78 | ||
| EV/EBITDA | 13.87 |
EPS(TTM)11.1
EY6.16%
EPS(NY)12.39
Fwd EY6.88%
FCF(TTM)8.24
FCFY4.58%
OCF(TTM)9.02
OCFY5.01%
SpS95.11
BVpS66.9
TBVpS37.66
PEG (NY)3.67
PEG (5Y)1.09
Graham Number129.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.67% | ||
| ROE | 9.97% | ||
| ROCE | 13.78% | ||
| ROIC | 10.72% | ||
| ROICexc | 15.51% | ||
| ROICexgc | 37.67% | ||
| OM | 10.43% | ||
| PM (TTM) | 7.01% | ||
| GM | 28.92% | ||
| FCFM | 8.67% |
ROA(3y)9.87%
ROA(5y)11.06%
ROE(3y)12.84%
ROE(5y)14.88%
ROIC(3y)11.98%
ROIC(5y)12.84%
ROICexc(3y)23.91%
ROICexc(5y)27.45%
ROICexgc(3y)44.54%
ROICexgc(5y)48.5%
ROCE(3y)15.42%
ROCE(5y)16.54%
ROICexgc growth 3Y-11.88%
ROICexgc growth 5Y3.29%
ROICexc growth 3Y-20.35%
ROICexc growth 5Y-8.92%
OM growth 3Y-7.24%
OM growth 5Y-2.7%
PM growth 3Y-9.14%
PM growth 5Y-3.32%
GM growth 3Y-3.28%
GM growth 5Y-2.67%
F-Score6
Asset Turnover1.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Debt/EBITDA | 0.04 | ||
| Cap/Depr | 46.68% | ||
| Cap/Sales | 0.82% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 77.89% | ||
| Profit Quality | 123.54% | ||
| Current Ratio | 3.02 | ||
| Quick Ratio | 3.02 | ||
| Altman-Z | 8.03 |
F-Score6
WACC8.84%
ROIC/WACC1.21
Cap/Depr(3y)51.75%
Cap/Depr(5y)79.67%
Cap/Sales(3y)0.99%
Cap/Sales(5y)1.71%
Profit Quality(3y)111.75%
Profit Quality(5y)115.25%
High Growth Momentum
Growth
EPS 1Y (TTM)2.97%
EPS 3Y6.34%
EPS 5Y14.89%
EPS Q2Q%-1.28%
EPS Next Y4.42%
EPS Next 2Y6.78%
EPS Next 3Y8.14%
EPS Next 5Y4.56%
Revenue 1Y (TTM)14.26%
Revenue growth 3Y7.95%
Revenue growth 5Y15.56%
Sales Q2Q%19.43%
Revenue Next Year15.23%
Revenue Next 2Y11.14%
Revenue Next 3Y10.23%
Revenue Next 5Y7.65%
EBIT growth 1Y3.34%
EBIT growth 3Y0.14%
EBIT growth 5Y12.45%
EBIT Next Year16.3%
EBIT Next 3Y12.45%
EBIT Next 5Y11.07%
FCF growth 1Y-14.58%
FCF growth 3Y4.58%
FCF growth 5Y22.87%
OCF growth 1Y-13.01%
OCF growth 3Y-0.77%
OCF growth 5Y14.23%
EPAM SYSTEMS INC / EPAM FAQ
What is the fundamental rating for EPAM stock?
ChartMill assigns a fundamental rating of 6 / 10 to EPAM.
What is the valuation status of EPAM SYSTEMS INC (EPAM) stock?
ChartMill assigns a valuation rating of 5 / 10 to EPAM SYSTEMS INC (EPAM). This can be considered as Fairly Valued.
What is the profitability of EPAM stock?
EPAM SYSTEMS INC (EPAM) has a profitability rating of 5 / 10.
Can you provide the expected EPS growth for EPAM stock?
The Earnings per Share (EPS) of EPAM SYSTEMS INC (EPAM) is expected to grow by 4.42% in the next year.