PROGRESS SOFTWARE CORP (PRGS) Stock Fundamental Analysis
NASDAQ:PRGS - US7433121008 - Common Stock
46.31 USD
-0.53 (-1.13%)
46.31 USD
0 (0%)
Overall PRGS gets a fundamental rating of 5 out of 10. We evaluated PRGS against 282 industry peers in the Software industry. PRGS has an excellent profitability rating, but there are concerns on its financial health. PRGS may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year PRGS was profitable.
PRGS had a positive operating cash flow in the past year.
In the past 5 years PRGS has always been profitable.
PRGS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PRGS has a Return On Assets of 2.39%. This is in the better half of the industry: PRGS outperforms 68.09% of its industry peers.
Looking at the Return On Equity, with a value of 12.72%, PRGS is in the better half of the industry, outperforming 79.08% of the companies in the same industry.
PRGS's Return On Invested Capital of 8.29% is amongst the best of the industry. PRGS outperforms 80.85% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PRGS is below the industry average of 11.98%.
The 3 year average ROIC (7.93%) for PRGS is below the current ROIC(8.29%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.39% | ||
| ROE | 12.72% | ||
| ROIC | 8.29% |
ROA(3y)4.61%
ROA(5y)5.45%
ROE(3y)18.24%
ROE(5y)19.35%
ROIC(3y)7.93%
ROIC(5y)9.13%
1.3 Margins
PRGS has a better Profit Margin (6.63%) than 71.28% of its industry peers.
PRGS's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 19.74%, PRGS belongs to the top of the industry, outperforming 85.82% of the companies in the same industry.
PRGS's Operating Margin has improved in the last couple of years.
PRGS has a Gross Margin of 81.69%. This is amongst the best in the industry. PRGS outperforms 86.88% of its industry peers.
In the last couple of years the Gross Margin of PRGS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.74% | ||
| PM (TTM) | 6.63% | ||
| GM | 81.69% |
OM growth 3Y-4.3%
OM growth 5Y3.62%
PM growth 3Y-14.93%
PM growth 5Y7.3%
GM growth 3Y-1.01%
GM growth 5Y0.21%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PRGS is destroying value.
Compared to 1 year ago, PRGS has less shares outstanding
Compared to 5 years ago, PRGS has less shares outstanding
PRGS has a worse debt/assets ratio than last year.
2.2 Solvency
PRGS has an Altman-Z score of 1.07. This is a bad value and indicates that PRGS is not financially healthy and even has some risk of bankruptcy.
PRGS has a Altman-Z score of 1.07. This is in the lower half of the industry: PRGS underperforms 63.48% of its industry peers.
PRGS has a debt to FCF ratio of 8.55. This is a slightly negative value and a sign of low solvency as PRGS would need 8.55 years to pay back of all of its debts.
The Debt to FCF ratio of PRGS (8.55) is comparable to the rest of the industry.
PRGS has a Debt/Equity ratio of 2.43. This is a high value indicating a heavy dependency on external financing.
PRGS has a Debt to Equity ratio of 2.43. This is amonst the worse of the industry: PRGS underperforms 80.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.43 | ||
| Debt/FCF | 8.55 | ||
| Altman-Z | 1.07 |
ROIC/WACC0.85
WACC9.78%
2.3 Liquidity
PRGS has a Current Ratio of 0.43. This is a bad value and indicates that PRGS is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.43, PRGS is doing worse than 92.20% of the companies in the same industry.
PRGS has a Quick Ratio of 0.43. This is a bad value and indicates that PRGS is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.43, PRGS is not doing good in the industry: 91.49% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.43 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.37% over the past year.
The Earnings Per Share has been growing by 12.88% on average over the past years. This is quite good.
PRGS shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.10%.
Measured over the past years, PRGS shows a quite strong growth in Revenue. The Revenue has been growing by 12.76% on average per year.
EPS 1Y (TTM)19.37%
EPS 3Y8.4%
EPS 5Y12.88%
EPS Q2Q%28.44%
Revenue 1Y (TTM)22.1%
Revenue growth 3Y12.35%
Revenue growth 5Y12.76%
Sales Q2Q%35.57%
3.2 Future
The Earnings Per Share is expected to grow by 5.67% on average over the next years.
PRGS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.07% yearly.
EPS Next Y10.5%
EPS Next 2Y8.25%
EPS Next 3Y5.67%
EPS Next 5YN/A
Revenue Next Year29.03%
Revenue Next 2Y14.59%
Revenue Next 3Y10.12%
Revenue Next 5Y7.07%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 8.74, the valuation of PRGS can be described as very reasonable.
PRGS's Price/Earnings ratio is rather cheap when compared to the industry. PRGS is cheaper than 92.20% of the companies in the same industry.
PRGS is valuated cheaply when we compare the Price/Earnings ratio to 27.17, which is the current average of the S&P500 Index.
PRGS is valuated reasonably with a Price/Forward Earnings ratio of 8.02.
94.33% of the companies in the same industry are more expensive than PRGS, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.78. PRGS is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.74 | ||
| Fwd PE | 8.02 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PRGS is valued cheaper than 89.01% of the companies in the same industry.
93.62% of the companies in the same industry are more expensive than PRGS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.71 | ||
| EV/EBITDA | 11.26 |
4.3 Compensation for Growth
PRGS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PRGS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.83
PEG (5Y)0.68
EPS Next 2Y8.25%
EPS Next 3Y5.67%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.57%, PRGS has a reasonable but not impressive dividend return.
The stock price of PRGS dropped by -24.77% 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.
PRGS's Dividend Yield is rather good when compared to the industry average which is at 53.74. PRGS pays more dividend than 94.68% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.34, PRGS is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
5.2 History
The dividend of PRGS has a limited annual growth rate of 3.19%.
PRGS has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)3.19%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
27.77% of the earnings are spent on dividend by PRGS. This is a low number and sustainable payout ratio.
The dividend of PRGS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP27.77%
EPS Next 2Y8.25%
EPS Next 3Y5.67%
46.31
-0.53 (-1.13%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners119.15%
Inst Owner Change91.14%
Ins Owners1.73%
Ins Owner Change3.37%
Market Cap2.00B
Analysts83.33
Price Target71.4 (54.18%)
Short Float %13.45%
Short Ratio5.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
Yearly Dividend0.72
Dividend Growth(5Y)3.19%
DP27.77%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.47%
Min EPS beat(2)5.42%
Max EPS beat(2)21.52%
EPS beat(4)4
Avg EPS beat(4)10.7%
Min EPS beat(4)5.42%
Max EPS beat(4)21.52%
EPS beat(8)8
Avg EPS beat(8)9.79%
EPS beat(12)12
Avg EPS beat(12)8.88%
EPS beat(16)16
Avg EPS beat(16)11.82%
Revenue beat(2)0
Avg Revenue beat(2)-1.5%
Min Revenue beat(2)-2.03%
Max Revenue beat(2)-0.97%
Revenue beat(4)0
Avg Revenue beat(4)-0.91%
Min Revenue beat(4)-2.03%
Max Revenue beat(4)-0.24%
Revenue beat(8)1
Avg Revenue beat(8)-0.39%
Revenue beat(12)3
Avg Revenue beat(12)-0.29%
Revenue beat(16)6
Avg Revenue beat(16)0.49%
PT rev (1m)-2.33%
PT rev (3m)-3.89%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.25%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)0.84%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.66%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)0.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.74 | ||
| Fwd PE | 8.02 | ||
| P/S | 2.3 | ||
| P/FCF | 11.71 | ||
| P/OCF | 11.33 | ||
| P/B | 4.41 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.26 |
EPS(TTM)5.3
EY11.44%
EPS(NY)5.78
Fwd EY12.48%
FCF(TTM)3.96
FCFY8.54%
OCF(TTM)4.09
OCFY8.83%
SpS20.16
BVpS10.5
TBVpS-34.6
PEG (NY)0.83
PEG (5Y)0.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.39% | ||
| ROE | 12.72% | ||
| ROCE | 10.32% | ||
| ROIC | 8.29% | ||
| ROICexc | 8.83% | ||
| ROICexgc | N/A | ||
| OM | 19.74% | ||
| PM (TTM) | 6.63% | ||
| GM | 81.69% | ||
| FCFM | 19.62% |
ROA(3y)4.61%
ROA(5y)5.45%
ROE(3y)18.24%
ROE(5y)19.35%
ROIC(3y)7.93%
ROIC(5y)9.13%
ROICexc(3y)9.33%
ROICexc(5y)10.7%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)9.87%
ROCE(5y)11.36%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-17.49%
ROICexc growth 5Y-12.26%
OM growth 3Y-4.3%
OM growth 5Y3.62%
PM growth 3Y-14.93%
PM growth 5Y7.3%
GM growth 3Y-1.01%
GM growth 5Y0.21%
F-Score6
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.43 | ||
| Debt/FCF | 8.55 | ||
| Debt/EBITDA | 3.69 | ||
| Cap/Depr | 4.54% | ||
| Cap/Sales | 0.66% | ||
| Interest Coverage | 3.64 | ||
| Cash Conversion | 59.18% | ||
| Profit Quality | 296.12% | ||
| Current Ratio | 0.43 | ||
| Quick Ratio | 0.43 | ||
| Altman-Z | 1.07 |
F-Score6
WACC9.78%
ROIC/WACC0.85
Cap/Depr(3y)6.21%
Cap/Depr(5y)9.24%
Cap/Sales(3y)0.84%
Cap/Sales(5y)0.97%
Profit Quality(3y)245.65%
Profit Quality(5y)226.43%
High Growth Momentum
Growth
EPS 1Y (TTM)19.37%
EPS 3Y8.4%
EPS 5Y12.88%
EPS Q2Q%28.44%
EPS Next Y10.5%
EPS Next 2Y8.25%
EPS Next 3Y5.67%
EPS Next 5YN/A
Revenue 1Y (TTM)22.1%
Revenue growth 3Y12.35%
Revenue growth 5Y12.76%
Sales Q2Q%35.57%
Revenue Next Year29.03%
Revenue Next 2Y14.59%
Revenue Next 3Y10.12%
Revenue Next 5Y7.07%
EBIT growth 1Y33.68%
EBIT growth 3Y7.51%
EBIT growth 5Y16.84%
EBIT Next Year74.16%
EBIT Next 3Y20.8%
EBIT Next 5YN/A
FCF growth 1Y1.26%
FCF growth 3Y5.88%
FCF growth 5Y10.63%
OCF growth 1Y1%
OCF growth 3Y5.82%
OCF growth 5Y10.48%