Q2 HOLDINGS INC (QTWO) Stock Fundamental Analysis
NYSE:QTWO - US74736L1098 - Common Stock
78.73 USD
-0.1 (-0.13%)
78.73 USD
0 (0%)
Overall QTWO gets a fundamental rating of 5 out of 10. We evaluated QTWO against 280 industry peers in the Software industry. Both the profitability and the financial health of QTWO get a neutral evaluation. Nothing too spectacular is happening here. QTWO is growing strongly while it is still valued neutral. This is a good combination!
1. Profitability
1.1 Basic Checks
QTWO had positive earnings in the past year.
In the past year QTWO had a positive cash flow from operations.
QTWO had negative earnings in each of the past 5 years.
Of the past 5 years QTWO 4 years had a positive operating cash flow.
1.2 Ratios
QTWO has a Return On Assets of 0.35%. This is in the better half of the industry: QTWO outperforms 62.14% of its industry peers.
Looking at the Return On Equity, with a value of 0.84%, QTWO is in the better half of the industry, outperforming 64.29% of the companies in the same industry.
QTWO has a Return On Invested Capital of 0.60%. This is in the better half of the industry: QTWO outperforms 61.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.35% | ||
| ROE | 0.84% | ||
| ROIC | 0.6% |
ROA(3y)-5.5%
ROA(5y)-6.87%
ROE(3y)-16.01%
ROE(5y)-17.84%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
With a decent Profit Margin value of 0.66%, QTWO is doing good in the industry, outperforming 62.86% of the companies in the same industry.
With a decent Operating Margin value of 0.66%, QTWO is doing good in the industry, outperforming 61.43% of the companies in the same industry.
With a Gross Margin value of 52.62%, QTWO is not doing good in the industry: 66.43% of the companies in the same industry are doing better.
QTWO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.66% | ||
| PM (TTM) | 0.66% | ||
| GM | 52.62% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y4.1%
GM growth 5Y0.97%
2. Health
2.1 Basic Checks
QTWO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for QTWO has been increased compared to 1 year ago.
QTWO has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, QTWO has an improved debt to assets ratio.
2.2 Solvency
QTWO has an Altman-Z score of 3.51. This indicates that QTWO is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.51, QTWO is doing good in the industry, outperforming 61.07% of the companies in the same industry.
There is no outstanding debt for QTWO. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 3.26 | ||
| Altman-Z | 3.51 |
ROIC/WACC0.06
WACC10.8%
2.3 Liquidity
QTWO has a Current Ratio of 0.90. This is a bad value and indicates that QTWO is not financially healthy enough and could expect problems in meeting its short term obligations.
QTWO has a worse Current ratio (0.90) than 76.07% of its industry peers.
QTWO has a Quick Ratio of 0.90. This is a bad value and indicates that QTWO is not financially healthy enough and could expect problems in meeting its short term obligations.
QTWO has a worse Quick ratio (0.90) than 75.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 89.04% over the past year.
QTWO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 33.28% yearly.
The Revenue has grown by 13.34% in the past year. This is quite good.
QTWO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.16% yearly.
EPS 1Y (TTM)89.04%
EPS 3Y72.41%
EPS 5Y33.28%
EPS Q2Q%50%
Revenue 1Y (TTM)13.34%
Revenue growth 3Y11.78%
Revenue growth 5Y17.16%
Sales Q2Q%12.87%
3.2 Future
QTWO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 23.88% yearly.
QTWO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.81% yearly.
EPS Next Y39.52%
EPS Next 2Y24.05%
EPS Next 3Y23.88%
EPS Next 5YN/A
Revenue Next Year13.42%
Revenue Next 2Y12.03%
Revenue Next 3Y11.81%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 38.03, which means the current valuation is very expensive for QTWO.
QTWO's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of QTWO to the average of the S&P500 Index (27.13), we can say QTWO is valued slightly more expensively.
With a Price/Forward Earnings ratio of 31.20, QTWO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, QTWO is valued a bit cheaper than 62.14% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of QTWO to the average of the S&P500 Index (22.76), we can say QTWO is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.03 | ||
| Fwd PE | 31.2 |
4.2 Price Multiples
QTWO's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, QTWO is valued a bit cheaper than 71.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.45 | ||
| EV/EBITDA | 72.28 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as QTWO's earnings are expected to grow with 23.88% in the coming years.
PEG (NY)0.96
PEG (5Y)1.14
EPS Next 2Y24.05%
EPS Next 3Y23.88%
5. Dividend
5.1 Amount
QTWO does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
78.73
-0.1 (-0.13%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners105.48%
Inst Owner Change-1.99%
Ins Owners0.52%
Ins Owner Change-6.04%
Market Cap4.92B
Analysts79.09
Price Target104.56 (32.81%)
Short Float %4.34%
Short Ratio3.46
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)2
Avg EPS beat(2)10.13%
Min EPS beat(2)7.29%
Max EPS beat(2)12.97%
EPS beat(4)4
Avg EPS beat(4)13.49%
Min EPS beat(4)7.29%
Max EPS beat(4)23.75%
EPS beat(8)7
Avg EPS beat(8)9.14%
EPS beat(12)10
Avg EPS beat(12)32.79%
EPS beat(16)12
Avg EPS beat(16)27.48%
Revenue beat(2)0
Avg Revenue beat(2)-0.79%
Min Revenue beat(2)-1.24%
Max Revenue beat(2)-0.35%
Revenue beat(4)0
Avg Revenue beat(4)-0.72%
Min Revenue beat(4)-1.24%
Max Revenue beat(4)-0.26%
Revenue beat(8)0
Avg Revenue beat(8)-1.04%
Revenue beat(12)0
Avg Revenue beat(12)-1.44%
Revenue beat(16)0
Avg Revenue beat(16)-1.46%
PT rev (1m)2.16%
PT rev (3m)3.27%
EPS NQ rev (1m)2.33%
EPS NQ rev (3m)2.04%
EPS NY rev (1m)2.67%
EPS NY rev (3m)2.91%
Revenue NQ rev (1m)1.01%
Revenue NQ rev (3m)1.95%
Revenue NY rev (1m)0.66%
Revenue NY rev (3m)0.76%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.03 | ||
| Fwd PE | 31.2 | ||
| P/S | 6.62 | ||
| P/FCF | 32.45 | ||
| P/OCF | 27.55 | ||
| P/B | 8.41 | ||
| P/tB | N/A | ||
| EV/EBITDA | 72.28 |
EPS(TTM)2.07
EY2.63%
EPS(NY)2.52
Fwd EY3.21%
FCF(TTM)2.43
FCFY3.08%
OCF(TTM)2.86
OCFY3.63%
SpS11.9
BVpS9.36
TBVpS-0.25
PEG (NY)0.96
PEG (5Y)1.14
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.35% | ||
| ROE | 0.84% | ||
| ROCE | 0.76% | ||
| ROIC | 0.6% | ||
| ROICexc | 3.22% | ||
| ROICexgc | N/A | ||
| OM | 0.66% | ||
| PM (TTM) | 0.66% | ||
| GM | 52.62% | ||
| FCFM | 20.39% |
ROA(3y)-5.5%
ROA(5y)-6.87%
ROE(3y)-16.01%
ROE(5y)-17.84%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg 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 3Y4.1%
GM growth 5Y0.97%
F-Score7
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 3.26 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 44.3% | ||
| Cap/Sales | 3.63% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 271.01% | ||
| Profit Quality | 3101.41% | ||
| Current Ratio | 0.9 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 3.51 |
F-Score7
WACC10.8%
ROIC/WACC0.06
Cap/Depr(3y)44.55%
Cap/Depr(5y)45.59%
Cap/Sales(3y)4.8%
Cap/Sales(5y)5.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)89.04%
EPS 3Y72.41%
EPS 5Y33.28%
EPS Q2Q%50%
EPS Next Y39.52%
EPS Next 2Y24.05%
EPS Next 3Y23.88%
EPS Next 5YN/A
Revenue 1Y (TTM)13.34%
Revenue growth 3Y11.78%
Revenue growth 5Y17.16%
Sales Q2Q%12.87%
Revenue Next Year13.42%
Revenue Next 2Y12.03%
Revenue Next 3Y11.81%
Revenue Next 5YN/A
EBIT growth 1Y108.18%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year90.15%
EBIT Next 3Y39.61%
EBIT Next 5YN/A
FCF growth 1Y327.29%
FCF growth 3Y169.21%
FCF growth 5YN/A
OCF growth 1Y165.01%
OCF growth 3Y63.45%
OCF growth 5Y198.8%