SS&C TECHNOLOGIES HOLDINGS (SSNC) Stock Fundamental Analysis
NASDAQ:SSNC - Nasdaq - US78467J1007 - Common Stock - Currency: USD
Taking everything into account, SSNC scores 5 out of 10 in our fundamental rating. SSNC was compared to 82 industry peers in the IT Services industry. While SSNC belongs to the best of the industry regarding profitability, there are concerns on its financial health. SSNC has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
SSNC had positive earnings in the past year.
SSNC had a positive operating cash flow in the past year.
In the past 5 years SSNC has always been profitable.
Each year in the past 5 years SSNC had a positive operating cash flow.
1.2 Ratios
The Return On Assets of SSNC (4.00%) is better than 62.20% of its industry peers.
With a decent Return On Equity value of 12.02%, SSNC is doing good in the industry, outperforming 69.51% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 7.24%, SSNC is in the better half of the industry, outperforming 63.41% of the companies in the same industry.
SSNC had an Average Return On Invested Capital over the past 3 years of 6.63%. This is significantly below the industry average of 21.64%.
The 3 year average ROIC (6.63%) for SSNC is below the current ROIC(7.24%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4% | ||
| ROE | 12.02% | ||
| ROIC | 7.24% |
ROA(3y)3.75%
ROA(5y)3.96%
ROE(3y)10.66%
ROE(5y)11.18%
ROIC(3y)6.63%
ROIC(5y)6.55%
1.3 Margins
With an excellent Profit Margin value of 13.69%, SSNC belongs to the best of the industry, outperforming 90.24% of the companies in the same industry.
In the last couple of years the Profit Margin of SSNC has grown nicely.
Looking at the Operating Margin, with a value of 22.96%, SSNC belongs to the top of the industry, outperforming 96.34% of the companies in the same industry.
SSNC's Operating Margin has improved in the last couple of years.
SSNC's Gross Margin of 48.71% is fine compared to the rest of the industry. SSNC outperforms 67.07% of its industry peers.
In the last couple of years the Gross Margin of SSNC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.96% | ||
| PM (TTM) | 13.69% | ||
| GM | 48.71% |
OM growth 3Y-2.44%
OM growth 5Y2.96%
PM growth 3Y-6.54%
PM growth 5Y6.44%
GM growth 3Y0.68%
GM growth 5Y2.22%
2. Health
2.1 Basic Checks
SSNC 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 SSNC has been reduced compared to 1 year ago.
Compared to 5 years ago, SSNC has less shares outstanding
Compared to 1 year ago, SSNC has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.71, we must say that SSNC is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of SSNC (1.71) is worse than 65.85% of its industry peers.
The Debt to FCF ratio of SSNC is 5.62, which is a neutral value as it means it would take SSNC, 5.62 years of fcf income to pay off all of its debts.
SSNC has a Debt to FCF ratio (5.62) which is comparable to the rest of the industry.
A Debt/Equity ratio of 1.01 is on the high side and indicates that SSNC has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.01, SSNC is doing worse than 69.51% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 5.62 | ||
| Altman-Z | 1.71 |
ROIC/WACC0.76
WACC9.54%
2.3 Liquidity
SSNC has a Current Ratio of 1.11. This is a normal value and indicates that SSNC is financially healthy and should not expect problems in meeting its short term obligations.
SSNC has a Current ratio of 1.11. This is in the lower half of the industry: SSNC underperforms 71.95% of its industry peers.
SSNC has a Quick Ratio of 1.11. This is a normal value and indicates that SSNC is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of SSNC (1.11) is worse than 70.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 16.49% over the past year.
Measured over the past 5 years, SSNC shows a small growth in Earnings Per Share. The EPS has been growing by 7.19% on average per year.
The Revenue has been growing slightly by 6.92% in the past year.
Measured over the past years, SSNC shows a small growth in Revenue. The Revenue has been growing by 4.89% on average per year.
EPS 1Y (TTM)16.49%
EPS 3Y2.59%
EPS 5Y7.19%
EPS Q2Q%12.5%
Revenue 1Y (TTM)6.92%
Revenue growth 3Y5.21%
Revenue growth 5Y4.89%
Sales Q2Q%5.5%
3.2 Future
The Earnings Per Share is expected to grow by 5.64% on average over the next years.
SSNC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.28% yearly.
EPS Next Y10.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
EPS Next 5Y5.64%
Revenue Next Year5.98%
Revenue Next 2Y5.47%
Revenue Next 3Y5%
Revenue Next 5Y5.28%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 14.78, SSNC is valued correctly.
Based on the Price/Earnings ratio, SSNC is valued a bit cheaper than the industry average as 76.83% of the companies are valued more expensively.
SSNC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.30.
Based on the Price/Forward Earnings ratio of 12.53, the valuation of SSNC can be described as correct.
81.71% of the companies in the same industry are more expensive than SSNC, based on the Price/Forward Earnings ratio.
SSNC is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.78 | ||
| Fwd PE | 12.53 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SSNC indicates a somewhat cheap valuation: SSNC is cheaper than 70.73% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, SSNC is valued a bit cheaper than 79.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.67 | ||
| EV/EBITDA | 13 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of SSNC may justify a higher PE ratio.
PEG (NY)1.44
PEG (5Y)2.06
EPS Next 2Y10.23%
EPS Next 3Y9.31%
5. Dividend
5.1 Amount
SSNC has a Yearly Dividend Yield of 1.20%.
Compared to an average industry Dividend Yield of 2.48, SSNC pays a better dividend. On top of this SSNC pays more dividend than 81.71% of the companies listed in the same industry.
With a Dividend Yield of 1.20, SSNC pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.2% |
5.2 History
The dividend of SSNC is nicely growing with an annual growth rate of 18.56%!
SSNC has been paying a dividend for at least 10 years, so it has a reliable track record.
SSNC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)18.56%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
SSNC pays out 30.25% of its income as dividend. This is a sustainable payout ratio.
SSNC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP30.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
82.5
-1.11 (-1.33%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners85.2%
Inst Owner Change0.12%
Ins Owners14.39%
Ins Owner Change0.28%
Market Cap20.35B
Analysts83.53
Price Target95.14 (15.32%)
Short Float %2.02%
Short Ratio3.19
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.2% |
Yearly Dividend1
Dividend Growth(5Y)18.56%
DP30.25%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.71%
Min EPS beat(2)0.42%
Max EPS beat(2)16.99%
EPS beat(4)4
Avg EPS beat(4)5.48%
Min EPS beat(4)0.42%
Max EPS beat(4)16.99%
EPS beat(8)5
Avg EPS beat(8)2.15%
EPS beat(12)5
Avg EPS beat(12)-0.23%
EPS beat(16)8
Avg EPS beat(16)0.76%
Revenue beat(2)1
Avg Revenue beat(2)-0.1%
Min Revenue beat(2)-1.31%
Max Revenue beat(2)1.1%
Revenue beat(4)1
Avg Revenue beat(4)-0.3%
Min Revenue beat(4)-1.31%
Max Revenue beat(4)1.1%
Revenue beat(8)1
Avg Revenue beat(8)-0.82%
Revenue beat(12)1
Avg Revenue beat(12)-1.35%
Revenue beat(16)4
Avg Revenue beat(16)-0.89%
PT rev (1m)0%
PT rev (3m)-3.5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.25%
EPS NY rev (1m)0.1%
EPS NY rev (3m)0.22%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.21%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.78 | ||
| Fwd PE | 12.53 | ||
| P/S | 3.41 | ||
| P/FCF | 16.67 | ||
| P/OCF | 13.75 | ||
| P/B | 3 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13 |
EPS(TTM)5.58
EY6.76%
EPS(NY)6.59
Fwd EY7.98%
FCF(TTM)4.95
FCFY6%
OCF(TTM)6
OCFY7.27%
SpS24.17
BVpS27.51
TBVpS-25.42
PEG (NY)1.44
PEG (5Y)2.06
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4% | ||
| ROE | 12.02% | ||
| ROCE | 9.27% | ||
| ROIC | 7.24% | ||
| ROICexc | 7.5% | ||
| ROICexgc | 89.27% | ||
| OM | 22.96% | ||
| PM (TTM) | 13.69% | ||
| GM | 48.71% | ||
| FCFM | 20.48% |
ROA(3y)3.75%
ROA(5y)3.96%
ROE(3y)10.66%
ROE(5y)11.18%
ROIC(3y)6.63%
ROIC(5y)6.55%
ROICexc(3y)6.86%
ROICexc(5y)6.77%
ROICexgc(3y)94.96%
ROICexgc(5y)89.67%
ROCE(3y)8.49%
ROCE(5y)8.39%
ROICexcg growth 3Y3.29%
ROICexcg growth 5Y10.46%
ROICexc growth 3Y-0.36%
ROICexc growth 5Y7.52%
OM growth 3Y-2.44%
OM growth 5Y2.96%
PM growth 3Y-6.54%
PM growth 5Y6.44%
GM growth 3Y0.68%
GM growth 5Y2.22%
F-Score6
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.01 | ||
| Debt/FCF | 5.62 | ||
| Debt/EBITDA | 3.33 | ||
| Cap/Depr | 37.88% | ||
| Cap/Sales | 4.36% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 72.07% | ||
| Profit Quality | 149.61% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 1.71 |
F-Score6
WACC9.54%
ROIC/WACC0.76
Cap/Depr(3y)35.38%
Cap/Depr(5y)28.25%
Cap/Sales(3y)4.29%
Cap/Sales(5y)3.57%
Profit Quality(3y)150.04%
Profit Quality(5y)156.83%
High Growth Momentum
Growth
EPS 1Y (TTM)16.49%
EPS 3Y2.59%
EPS 5Y7.19%
EPS Q2Q%12.5%
EPS Next Y10.25%
EPS Next 2Y10.23%
EPS Next 3Y9.31%
EPS Next 5Y5.64%
Revenue 1Y (TTM)6.92%
Revenue growth 3Y5.21%
Revenue growth 5Y4.89%
Sales Q2Q%5.5%
Revenue Next Year5.98%
Revenue Next 2Y5.47%
Revenue Next 3Y5%
Revenue Next 5Y5.28%
EBIT growth 1Y8.46%
EBIT growth 3Y2.64%
EBIT growth 5Y8%
EBIT Next Year10.33%
EBIT Next 3Y7.55%
EBIT Next 5Y6.97%
FCF growth 1Y24.59%
FCF growth 3Y-4.3%
FCF growth 5Y-1.11%
OCF growth 1Y22.79%
OCF growth 3Y-0.95%
OCF growth 5Y0.89%