PEGASYSTEMS INC (PEGA) Fundamental Analysis & Valuation

NASDAQ:PEGA • US7055731035

Current stock price

39.29 USD
-4.51 (-10.3%)
At close:
40.55 USD
+1.26 (+3.21%)
After Hours:

This PEGA fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. PEGA Profitability Analysis

1.1 Basic Checks

  • PEGA had positive earnings in the past year.
  • PEGA had a positive operating cash flow in the past year.
  • In multiple years PEGA reported negative net income over the last 5 years.
  • PEGA had a positive operating cash flow in each of the past 5 years.
PEGA Yearly Net Income VS EBIT VS OCF VS FCFPEGA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M

1.2 Ratios

  • PEGA has a Return On Assets of 24.11%. This is amongst the best in the industry. PEGA outperforms 97.06% of its industry peers.
  • The Return On Equity of PEGA (49.97%) is better than 95.59% of its industry peers.
  • Looking at the Return On Invested Capital, with a value of 22.12%, PEGA belongs to the top of the industry, outperforming 94.85% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years for PEGA is above the industry average of 10.91%.
  • The 3 year average ROIC (15.39%) for PEGA is below the current ROIC(22.12%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 24.11%
ROE 49.97%
ROIC 22.12%
ROA(3y)11.4%
ROA(5y)0.96%
ROE(3y)28.69%
ROE(5y)-38.66%
ROIC(3y)15.39%
ROIC(5y)N/A
PEGA Yearly ROA, ROE, ROICPEGA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 -100 -200

1.3 Margins

  • PEGA has a Profit Margin of 22.54%. This is amongst the best in the industry. PEGA outperforms 90.07% of its industry peers.
  • The Operating Margin of PEGA (16.29%) is better than 83.46% of its industry peers.
  • PEGA has a better Gross Margin (75.86%) than 68.38% of its industry peers.
  • PEGA's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 16.29%
PM (TTM) 22.54%
GM 75.86%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.74%
GM growth 5Y1.78%
PEGA Yearly Profit, Operating, Gross MarginsPEGA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20 -20 40 60

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ROAROEROICOperating and Profit MarginShow most profitable peers

9

2. PEGA Health Analysis

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so PEGA is creating value.
  • The number of shares outstanding for PEGA has been reduced compared to 1 year ago.
  • Compared to 5 years ago, PEGA has more shares outstanding
  • There is no outstanding debt for PEGA. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
PEGA Yearly Shares OutstandingPEGA Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M
PEGA Yearly Total Debt VS Total AssetsPEGA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B

2.2 Solvency

  • PEGA has an Altman-Z score of 6.94. This indicates that PEGA is financially healthy and has little risk of bankruptcy at the moment.
  • PEGA has a Altman-Z score of 6.94. This is amongst the best in the industry. PEGA outperforms 82.35% of its industry peers.
  • PEGA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 6.94
ROIC/WACC2.13
WACC10.4%
PEGA Yearly LT Debt VS Equity VS FCFPEGA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M 400M 600M

2.3 Liquidity

  • A Current Ratio of 1.33 indicates that PEGA should not have too much problems paying its short term obligations.
  • The Current ratio of PEGA (1.33) is comparable to the rest of the industry.
  • A Quick Ratio of 1.33 indicates that PEGA should not have too much problems paying its short term obligations.
  • With a Quick ratio value of 1.33, PEGA perfoms like the industry average, outperforming 42.28% of the companies in the same industry.
  • The current and quick ratio evaluation for PEGA is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
Industry RankSector Rank
Current Ratio 1.33
Quick Ratio 1.33
PEGA Yearly Current Assets VS Current LiabilitesPEGA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M 800M 1B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

4

3. PEGA Growth Analysis

3.1 Past

  • The earnings per share for PEGA have decreased strongly by -11.11% in the last year.
  • The Earnings Per Share has been growing by 82.73% on average over the past years. This is a very strong growth
  • PEGA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.61%.
  • Measured over the past years, PEGA shows a quite strong growth in Revenue. The Revenue has been growing by 11.40% on average per year.
EPS 1Y (TTM)-11.11%
EPS 3Y82.73%
EPS 5YN/A
EPS Q2Q%-39.87%
Revenue 1Y (TTM)16.61%
Revenue growth 3Y9.83%
Revenue growth 5Y11.4%
Sales Q2Q%-9.6%

3.2 Future

  • The Earnings Per Share is expected to grow by 1.38% on average over the next years.
  • Based on estimates for the next years, PEGA will show a small growth in Revenue. The Revenue will grow by 6.34% on average per year.
EPS Next Y31.85%
EPS Next 2Y20.78%
EPS Next 3Y14.75%
EPS Next 5Y1.38%
Revenue Next Year14.28%
Revenue Next 2Y13.08%
Revenue Next 3Y12.32%
Revenue Next 5Y6.34%

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.
PEGA Yearly Revenue VS EstimatesPEGA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 1B 2B 3B
PEGA Yearly EPS VS EstimatesPEGA Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 0 1 2 3

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7

4. PEGA Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 21.83, which indicates a rather expensive current valuation of PEGA.
  • PEGA's Price/Earnings ratio is a bit cheaper when compared to the industry. PEGA is cheaper than 68.01% of the companies in the same industry.
  • The average S&P500 Price/Earnings ratio is at 27.71. PEGA is valued slightly cheaper when compared to this.
  • Based on the Price/Forward Earnings ratio of 12.79, the valuation of PEGA can be described as correct.
  • Based on the Price/Forward Earnings ratio, PEGA is valued a bit cheaper than 79.04% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 38.09, PEGA is valued rather cheaply.
Industry RankSector Rank
PE 21.83
Fwd PE 12.79
PEGA Price Earnings VS Forward Price EarningsPEGA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, PEGA is valued a bit cheaper than the industry average as 73.90% of the companies are valued more expensively.
  • Based on the Price/Free Cash Flow ratio, PEGA is valued cheaply inside the industry as 83.82% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 13.53
EV/EBITDA 20.14
PEGA Per share dataPEGA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

4.3 Compensation for Growth

  • PEGA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • The excellent profitability rating of PEGA may justify a higher PE ratio.
  • A more expensive valuation may be justified as PEGA's earnings are expected to grow with 14.75% in the coming years.
PEG (NY)0.69
PEG (5Y)N/A
EPS Next 2Y20.78%
EPS Next 3Y14.75%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

4

5. PEGA Dividend Analysis

5.1 Amount

  • With a yearly dividend of 0.31%, PEGA is not a good candidate for dividend investing.
  • The stock price of PEGA dropped by -22.01% 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 0.64, PEGA pays a better dividend. On top of this PEGA pays more dividend than 88.97% of the companies listed in the same industry.
  • With a Dividend Yield of 0.31, PEGA pays less dividend than the S&P500 average, which is at 1.81.
Industry RankSector Rank
Dividend Yield 0.31%

5.2 History

  • The dividend of PEGA decreases each year by -5.53%.
  • PEGA has paid a dividend for at least 10 years, which is a reliable track record.
  • PEGA has decreased its dividend recently.
Dividend Growth(5Y)-5.53%
Div Incr Years1
Div Non Decr Years1
PEGA Yearly Dividends per sharePEGA Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.02 0.04 0.06 0.08

5.3 Sustainability

  • 3.92% of the earnings are spent on dividend by PEGA. This is a low number and sustainable payout ratio.
DP3.92%
EPS Next 2Y20.78%
EPS Next 3Y14.75%
PEGA Yearly Income VS Free CF VS DividendPEGA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M
PEGA Dividend Payout.PEGA Dividend Payout, showing the Payout Ratio.PEGA Dividend Payout.PayoutRetained Earnings

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PEGA Fundamentals: All Metrics, Ratios and Statistics

PEGASYSTEMS INC

NASDAQ:PEGA (4/21/2026, 8:05:57 PM)

After market: 40.55 +1.26 (+3.21%)

39.29

-4.51 (-10.3%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)04-21
Earnings (Next)N/A
Inst Owners60.88%
Inst Owner Change-0.55%
Ins Owners46.34%
Ins Owner Change-1.53%
Market Cap6.64B
Revenue(TTM)1.75B
Net Income(TTM)393.44M
Analysts84.21
Price Target60.97 (55.18%)
Short Float %8.77%
Short Ratio3.22
Dividend
Industry RankSector Rank
Dividend Yield 0.31%
Yearly Dividend0.09
Dividend Growth(5Y)-5.53%
DP3.92%
Div Incr Years1
Div Non Decr Years1
Ex-Date04-01
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)24.35%
Min EPS beat(2)1.37%
Max EPS beat(2)47.32%
EPS beat(4)4
Avg EPS beat(4)68.65%
Min EPS beat(4)1.37%
Max EPS beat(4)206.69%
EPS beat(8)8
Avg EPS beat(8)50.18%
EPS beat(12)10
Avg EPS beat(12)741.26%
EPS beat(16)12
Avg EPS beat(16)569.07%
Revenue beat(2)2
Avg Revenue beat(2)4.16%
Min Revenue beat(2)0.03%
Max Revenue beat(2)8.29%
Revenue beat(4)4
Avg Revenue beat(4)10.77%
Min Revenue beat(4)0.03%
Max Revenue beat(4)30.76%
Revenue beat(8)6
Avg Revenue beat(8)5.8%
Revenue beat(12)8
Avg Revenue beat(12)4.54%
Revenue beat(16)10
Avg Revenue beat(16)2.8%
PT rev (1m)3.39%
PT rev (3m)-16%
EPS NQ rev (1m)0%
EPS NQ rev (3m)10.79%
EPS NY rev (1m)0.28%
EPS NY rev (3m)22.76%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.92%
Revenue NY rev (1m)0%
Revenue NY rev (3m)6.64%
Valuation
Industry RankSector Rank
PE 21.83
Fwd PE 12.79
P/S 3.8
P/FCF 13.53
P/OCF 13.15
P/B 8.44
P/tB 9.43
EV/EBITDA 20.14
EPS(TTM)1.8
EY4.58%
EPS(NY)3.07
Fwd EY7.82%
FCF(TTM)2.9
FCFY7.39%
OCF(TTM)2.99
OCFY7.61%
SpS10.33
BVpS4.66
TBVpS4.17
PEG (NY)0.69
PEG (5Y)N/A
Graham Number13.7349 (-65.04%)
Profitability
Industry RankSector Rank
ROA 24.11%
ROE 49.97%
ROCE 31.81%
ROIC 22.12%
ROICexc 42.23%
ROICexgc 51.29%
OM 16.29%
PM (TTM) 22.54%
GM 75.86%
FCFM 28.11%
ROA(3y)11.4%
ROA(5y)0.96%
ROE(3y)28.69%
ROE(5y)-38.66%
ROIC(3y)15.39%
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)22.13%
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.74%
GM growth 5Y1.78%
F-Score9
Asset Turnover1.07
Health
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Debt/EBITDA 0
Cap/Depr 105.88%
Cap/Sales 0.83%
Interest Coverage 162.14
Cash Conversion 169.49%
Profit Quality 124.73%
Current Ratio 1.33
Quick Ratio 1.33
Altman-Z 6.94
F-Score9
WACC10.4%
ROIC/WACC2.13
Cap/Depr(3y)79.75%
Cap/Depr(5y)92.85%
Cap/Sales(3y)0.84%
Cap/Sales(5y)1.21%
Profit Quality(3y)254.05%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-11.11%
EPS 3Y82.73%
EPS 5YN/A
EPS Q2Q%-39.87%
EPS Next Y31.85%
EPS Next 2Y20.78%
EPS Next 3Y14.75%
EPS Next 5Y1.38%
Revenue 1Y (TTM)16.61%
Revenue growth 3Y9.83%
Revenue growth 5Y11.4%
Sales Q2Q%-9.6%
Revenue Next Year14.28%
Revenue Next 2Y13.08%
Revenue Next 3Y12.32%
Revenue Next 5Y6.34%
EBIT growth 1Y76.85%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year28.19%
EBIT Next 3Y19.95%
EBIT Next 5Y-0.44%
FCF growth 1Y45.09%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y46.05%
OCF growth 3Y182.96%
OCF growth 5YN/A

PEGASYSTEMS INC / PEGA Fundamental Analysis FAQ

What is the ChartMill fundamental rating of PEGASYSTEMS INC (PEGA) stock?

ChartMill assigns a fundamental rating of 7 / 10 to PEGA.


What is the valuation status for PEGA stock?

ChartMill assigns a valuation rating of 7 / 10 to PEGASYSTEMS INC (PEGA). This can be considered as Undervalued.


How profitable is PEGASYSTEMS INC (PEGA) stock?

PEGASYSTEMS INC (PEGA) has a profitability rating of 8 / 10.


What are the PE and PB ratios of PEGASYSTEMS INC (PEGA) stock?

The Price/Earnings (PE) ratio for PEGASYSTEMS INC (PEGA) is 21.83 and the Price/Book (PB) ratio is 8.44.


Can you provide the dividend sustainability for PEGA stock?

The dividend rating of PEGASYSTEMS INC (PEGA) is 4 / 10 and the dividend payout ratio is 3.92%.