POWERSCHOOL HOLDINGS INC-A (PWSC) Stock Fundamental Analysis
NYSE:PWSC - New York Stock Exchange, Inc. - US73939C1062 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to PWSC. PWSC was compared to 282 industry peers in the Software industry. Both the profitability and financial health of PWSC have multiple concerns. PWSC is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year PWSC was profitable.
PWSC had a positive operating cash flow in the past year.
PWSC had negative earnings in each of the past 5 years.
PWSC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PWSC has a Return On Assets (-1.48%) which is comparable to the rest of the industry.
PWSC has a Return On Equity (-4.32%) which is comparable to the rest of the industry.
The Return On Invested Capital of PWSC (0.35%) is better than 64.54% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PWSC is significantly below the industry average of 12.17%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.48% | ||
| ROE | -4.32% | ||
| ROIC | 0.35% |
ROA(3y)-0.79%
ROA(5y)-1.33%
ROE(3y)-2.27%
ROE(5y)-2.97%
ROIC(3y)0.41%
ROIC(5y)N/A
1.3 Margins
PWSC's Operating Margin of 2.05% is fine compared to the rest of the industry. PWSC outperforms 65.96% of its industry peers.
In the last couple of years the Operating Margin of PWSC has declined.
With a Gross Margin value of 58.82%, PWSC is not doing good in the industry: 62.06% of the companies in the same industry are doing better.
PWSC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.05% | ||
| PM (TTM) | N/A | ||
| GM | 58.82% |
OM growth 3Y-10.66%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.99%
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PWSC is destroying value.
The number of shares outstanding for PWSC has been increased compared to 1 year ago.
PWSC has a worse debt/assets ratio than last year.
2.2 Solvency
PWSC has an Altman-Z score of 1.12. This is a bad value and indicates that PWSC is not financially healthy and even has some risk of bankruptcy.
PWSC has a Altman-Z score of 1.12. This is in the lower half of the industry: PWSC underperforms 62.06% of its industry peers.
The Debt to FCF ratio of PWSC is 12.08, which is on the high side as it means it would take PWSC, 12.08 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of PWSC (12.08) is comparable to the rest of the industry.
PWSC has a Debt/Equity ratio of 0.77. This is a neutral value indicating PWSC is somewhat dependend on debt financing.
The Debt to Equity ratio of PWSC (0.77) is worse than 71.99% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 12.08 | ||
| Altman-Z | 1.12 |
ROIC/WACC0.03
WACC10.25%
2.3 Liquidity
A Current Ratio of 0.28 indicates that PWSC may have some problems paying its short term obligations.
PWSC has a worse Current ratio (0.28) than 96.81% of its industry peers.
A Quick Ratio of 0.28 indicates that PWSC may have some problems paying its short term obligations.
With a Quick ratio value of 0.28, PWSC is not doing good in the industry: 96.45% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.28 | ||
| Quick Ratio | 0.28 |
3. Growth
3.1 Past
PWSC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.99%.
Looking at the last year, PWSC shows a quite strong growth in Revenue. The Revenue has grown by 12.79% in the last year.
Measured over the past years, PWSC shows a quite strong growth in Revenue. The Revenue has been growing by 17.06% on average per year.
EPS 1Y (TTM)-8.99%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%0%
Revenue 1Y (TTM)12.79%
Revenue growth 3Y17.06%
Revenue growth 5YN/A
Sales Q2Q%10.18%
3.2 Future
The Earnings Per Share is expected to grow by 16.06% on average over the next years. This is quite good.
PWSC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.40% yearly.
EPS Next Y14.16%
EPS Next 2Y18.27%
EPS Next 3Y16.06%
EPS Next 5YN/A
Revenue Next Year12.84%
Revenue Next 2Y11.67%
Revenue Next 3Y11.4%
Revenue Next 5YN/A
3.3 Evolution
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
The Price/Earnings ratio is 28.16, which means the current valuation is very expensive for PWSC.
Based on the Price/Earnings ratio, PWSC is valued a bit cheaper than 73.05% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.50, PWSC is valued at the same level.
A Price/Forward Earnings ratio of 19.89 indicates a rather expensive valuation of PWSC.
PWSC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. PWSC is cheaper than 79.08% of the companies in the same industry.
PWSC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 36.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.16 | ||
| Fwd PE | 19.89 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PWSC is valued a bit cheaper than 71.63% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PWSC is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 56.03 | ||
| EV/EBITDA | 35.29 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as PWSC's earnings are expected to grow with 16.06% in the coming years.
PEG (NY)1.99
PEG (5Y)N/A
EPS Next 2Y18.27%
EPS Next 3Y16.06%
5. Dividend
5.1 Amount
No dividends for PWSC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
22.81
-0.04 (-0.18%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners61.59%
Inst Owner Change0%
Ins Owners0.19%
Ins Owner Change0%
Market Cap4.66B
Analysts72.86
Price Target25.32 (11%)
Short Float %N/A
Short RatioN/A
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)0
Avg EPS beat(2)-13.21%
Min EPS beat(2)-19.52%
Max EPS beat(2)-6.91%
EPS beat(4)1
Avg EPS beat(4)-7.62%
Min EPS beat(4)-19.91%
Max EPS beat(4)15.86%
EPS beat(8)3
Avg EPS beat(8)-0.79%
EPS beat(12)6
Avg EPS beat(12)8.5%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-2.84%
Min Revenue beat(2)-3.8%
Max Revenue beat(2)-1.88%
Revenue beat(4)0
Avg Revenue beat(4)-2.24%
Min Revenue beat(4)-3.8%
Max Revenue beat(4)-0.63%
Revenue beat(8)0
Avg Revenue beat(8)-2.14%
Revenue beat(12)2
Avg Revenue beat(12)-1.17%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)2.86%
PT rev (3m)3.58%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.16%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.16 | ||
| Fwd PE | 19.89 | ||
| P/S | 6.29 | ||
| P/FCF | 56.03 | ||
| P/OCF | 36.91 | ||
| P/B | 3.61 | ||
| P/tB | N/A | ||
| EV/EBITDA | 35.29 |
EPS(TTM)0.81
EY3.55%
EPS(NY)1.15
Fwd EY5.03%
FCF(TTM)0.41
FCFY1.78%
OCF(TTM)0.62
OCFY2.71%
SpS3.63
BVpS6.31
TBVpS-11.06
PEG (NY)1.99
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.48% | ||
| ROE | -4.32% | ||
| ROCE | 0.47% | ||
| ROIC | 0.35% | ||
| ROICexc | 0.36% | ||
| ROICexgc | N/A | ||
| OM | 2.05% | ||
| PM (TTM) | N/A | ||
| GM | 58.82% | ||
| FCFM | 11.23% |
ROA(3y)-0.79%
ROA(5y)-1.33%
ROE(3y)-2.27%
ROE(5y)-2.97%
ROIC(3y)0.41%
ROIC(5y)N/A
ROICexc(3y)0.42%
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)0.52%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y0.35%
ROICexc growth 5YN/A
OM growth 3Y-10.66%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1.99%
GM growth 5YN/A
F-Score4
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 12.08 | ||
| Debt/EBITDA | 6.44 | ||
| Cap/Depr | 30.89% | ||
| Cap/Sales | 5.81% | ||
| Interest Coverage | 0.21 | ||
| Cash Conversion | 81.64% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.28 | ||
| Quick Ratio | 0.28 | ||
| Altman-Z | 1.12 |
F-Score4
WACC10.25%
ROIC/WACC0.03
Cap/Depr(3y)34.47%
Cap/Depr(5y)35.58%
Cap/Sales(3y)6.72%
Cap/Sales(5y)7.4%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-8.99%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%0%
EPS Next Y14.16%
EPS Next 2Y18.27%
EPS Next 3Y16.06%
EPS Next 5YN/A
Revenue 1Y (TTM)12.79%
Revenue growth 3Y17.06%
Revenue growth 5YN/A
Sales Q2Q%10.18%
Revenue Next Year12.84%
Revenue Next 2Y11.67%
Revenue Next 3Y11.4%
Revenue Next 5YN/A
EBIT growth 1Y-19.97%
EBIT growth 3Y4.59%
EBIT growth 5YN/A
EBIT Next Year44.79%
EBIT Next 3Y23.92%
EBIT Next 5YN/A
FCF growth 1Y15.54%
FCF growth 3Y30.83%
FCF growth 5YN/A
OCF growth 1Y11.04%
OCF growth 3Y23.99%
OCF growth 5YN/A