EPAM SYSTEMS INC (EPAM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:EPAM - US29414B1044 - Common Stock
209.06 USD
-0.02 (-0.01%)
We assign a fundamental rating of 5 out of 10 to EPAM. EPAM was compared to 88 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
In the past year EPAM was profitable.
In the past year EPAM had a positive cash flow from operations.
EPAM had positive earnings in each of the past 5 years.
Each year in the past 5 years EPAM had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.67%, EPAM is in the better half of the industry, outperforming 77.27% of the companies in the same industry.
With a decent Return On Equity value of 9.97%, EPAM is doing good in the industry, outperforming 65.91% of the companies in the same industry.
With a decent Return On Invested Capital value of 10.71%, EPAM is doing good in the industry, outperforming 77.27% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for EPAM is significantly below the industry average of 29.60%.
| 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
With a decent Profit Margin value of 7.01%, EPAM is doing good in the industry, outperforming 69.32% of the companies in the same industry.
EPAM's Profit Margin has declined in the last couple of years.
EPAM has a better Operating Margin (10.43%) than 71.59% of its industry peers.
EPAM's Operating Margin has declined in the last couple of years.
The Gross Margin of EPAM (28.92%) is worse than 62.50% of its industry peers.
EPAM's Gross Margin has declined in the last couple of years.
| 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.
The number of shares outstanding for EPAM has been reduced compared to 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
An Altman-Z score of 8.78 indicates that EPAM is not in any danger for bankruptcy at the moment.
EPAM has a Altman-Z score of 8.78. This is amongst the best in the industry. EPAM outperforms 90.91% 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 better Debt to FCF ratio (0.05) than 92.05% of its industry peers.
EPAM has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.01, EPAM belongs to the best of the industry, outperforming 80.68% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Altman-Z | 8.78 |
ROIC/WACC1.18
WACC9.07%
2.3 Liquidity
EPAM has a Current Ratio of 3.02. This indicates that EPAM is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 3.02, EPAM is in the better half of the industry, outperforming 78.41% of the companies in the same industry.
A Quick Ratio of 3.02 indicates that EPAM has no problem at all paying its short term obligations.
EPAM has a better Quick ratio (3.02) than 79.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.02 | ||
| Quick Ratio | 3.02 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.97% over the past year.
Measured over the past years, EPAM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 14.89% on average per year.
The Revenue has grown by 14.26% in the past year. This is quite good.
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
Based on estimates for the next years, EPAM will show a small growth in Earnings Per Share. The EPS will grow by 5.17% on average per year.
The Revenue is expected to grow by 7.81% on average over the next years.
EPS Next Y7.22%
EPS Next 2Y8.16%
EPS Next 3Y9.19%
EPS Next 5Y5.17%
Revenue Next Year15.96%
Revenue Next 2Y11.41%
Revenue Next 3Y10.52%
Revenue Next 5Y7.81%
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
With a Price/Earnings ratio of 18.83, EPAM is valued on the expensive side.
EPAM's Price/Earnings ratio is a bit cheaper when compared to the industry. EPAM is cheaper than 70.45% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.59. EPAM is valued slightly cheaper when compared to this.
EPAM is valuated correctly with a Price/Forward Earnings ratio of 16.44.
Compared to the rest of the industry, the Price/Forward Earnings ratio of EPAM indicates a somewhat cheap valuation: EPAM is cheaper than 71.59% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of EPAM to the average of the S&P500 Index (24.03), we can say EPAM is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.83 | ||
| Fwd PE | 16.44 |
4.2 Price Multiples
64.77% of the companies in the same industry are more expensive than EPAM, based on the Enterprise Value to EBITDA ratio.
EPAM's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.15 | ||
| EV/EBITDA | 16.03 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates EPAM does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.61
PEG (5Y)1.26
EPS Next 2Y8.16%
EPS Next 3Y9.19%
5. Dividend
5.1 Amount
EPAM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
NYSE:EPAM (12/26/2025, 9:43:28 AM)
209.06
-0.02 (-0.01%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners98.81%
Inst Owner Change1.96%
Ins Owners3.62%
Ins Owner Change-0.21%
Market Cap11.55B
Revenue(TTM)5.30B
Net Income(TTM)371.62M
Analysts80
Price TargetN/A
Short Float %5.35%
Short Ratio3.22
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)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)1.17%
PT rev (3m)-2.43%
EPS NQ rev (1m)0%
EPS NQ rev (3m)9.17%
EPS NY rev (1m)2.68%
EPS NY rev (3m)3.22%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.07%
Revenue NY rev (1m)0.63%
Revenue NY rev (3m)0.62%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.83 | ||
| Fwd PE | 16.44 | ||
| P/S | 2.18 | ||
| P/FCF | 25.15 | ||
| P/OCF | 22.99 | ||
| P/B | 3.1 | ||
| P/tB | 5.51 | ||
| EV/EBITDA | 16.03 |
EPS(TTM)11.1
EY5.31%
EPS(NY)12.72
Fwd EY6.08%
FCF(TTM)8.31
FCFY3.98%
OCF(TTM)9.09
OCFY4.35%
SpS95.91
BVpS67.46
TBVpS37.97
PEG (NY)2.61
PEG (5Y)1.26
Graham Number129.8
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 | 8.78 |
F-Score6
WACC9.07%
ROIC/WACC1.18
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 Y7.22%
EPS Next 2Y8.16%
EPS Next 3Y9.19%
EPS Next 5Y5.17%
Revenue 1Y (TTM)14.26%
Revenue growth 3Y7.95%
Revenue growth 5Y15.56%
Sales Q2Q%19.43%
Revenue Next Year15.96%
Revenue Next 2Y11.41%
Revenue Next 3Y10.52%
Revenue Next 5Y7.81%
EBIT growth 1Y3.34%
EBIT growth 3Y0.14%
EBIT growth 5Y12.45%
EBIT Next Year19.76%
EBIT Next 3Y13.13%
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 5 / 10 to EPAM.
What is the valuation status of EPAM SYSTEMS INC (EPAM) stock?
ChartMill assigns a valuation rating of 4 / 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 7.22% in the next year.