Jack Henry & Associates, Inc.
Jack Henry & Associates, Inc. Fundamental Analysis
Jack Henry & Associates, Inc. (JKHY) shows strong financial fundamentals with a PE ratio of 22.70, profit margin of 20.59%, and ROE of 23.75%. The company generates $2.5B in annual revenue with moderate year-over-year growth of 7.21%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 82.2/100 based on profitability, valuation, growth, and balance sheet metrics. The B+ grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze JKHY's fundamental strength across five key dimensions:
Efficiency Score
ExcellentJKHY demonstrates superior asset utilization.
Valuation Score
ModerateJKHY shows balanced valuation metrics.
Growth Score
ExcellentJKHY delivers strong and consistent growth momentum.
Financial Health Score
ExcellentJKHY maintains a strong and stable balance sheet.
Profitability Score
ExcellentJKHY achieves industry-leading margins.
Key Financial Metrics
Is JKHY Expensive or Cheap?
P/E Ratio
JKHY trades at 22.70 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, JKHY's PEG of 3.94 indicates potential overvaluation.
Price to Book
The market values Jack Henry & Associates, Inc. at 5.23 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 13.13 times EBITDA. This signals the market has high growth expectations.
How Well Does JKHY Make Money?
Net Profit Margin
For every $100 in sales, Jack Henry & Associates, Inc. keeps $20.59 as profit after all expenses.
Operating Margin
Core operations generate 25.87 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $23.75 in profit for every $100 of shareholder equity.
ROA
Jack Henry & Associates, Inc. generates $16.58 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Jack Henry & Associates, Inc. generates strong operating cash flow of $707.87M, reflecting robust business health.
Free Cash Flow
Jack Henry & Associates, Inc. generates strong free cash flow of $653.91M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $9.03 in free cash annually.
FCF Yield
JKHY converts 5.69% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.70
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
3.94
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.23
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.67
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.05
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.38
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.24
vs 25 benchmark
ROA
Return on assets percentage
0.17
vs 25 benchmark
ROCE
Return on capital employed
0.24
vs 25 benchmark
How JKHY Stacks Against Its Sector Peers
| Metric | JKHY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.70 | 35.19 | Better (Cheaper) |
| ROE | 23.75% | 1155.00% | Weak |
| Net Margin | 20.59% | -127067.00% (disorted) | Strong |
| Debt/Equity | 0.05 | 0.41 | Strong (Low Leverage) |
| Current Ratio | 1.38 | 4.71 | Neutral |
| ROA | 16.58% | -314918.00% (disorted) | Strong |
JKHY outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Jack Henry & Associates, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
47.13%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
61.49%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
32.09%
Industry Style: Growth, Innovation, High Beta
High Growth