Progress Software Corporation
Progress Software Corporation Fundamental Analysis
Progress Software Corporation (PRGS) shows moderate financial fundamentals with a PE ratio of 13.48, profit margin of 8.61%, and ROE of 17.82%. The company generates $1.0B in annual revenue with strong year-over-year growth of 29.79%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 58.4/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze PRGS's fundamental strength across five key dimensions:
Efficiency Score
WeakPRGS struggles to generate sufficient returns from assets.
Valuation Score
ExcellentPRGS trades at attractive valuation levels.
Growth Score
ModeratePRGS shows steady but slowing expansion.
Financial Health Score
WeakPRGS carries high financial risk with limited liquidity.
Profitability Score
ModeratePRGS maintains healthy but balanced margins.
Key Financial Metrics
Is PRGS Expensive or Cheap?
P/E Ratio
PRGS trades at 13.48 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, PRGS's PEG of 0.26 indicates potential undervaluation.
Price to Book
The market values Progress Software Corporation at 2.30 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 2.22 times EBITDA. This is generally considered low.
How Well Does PRGS Make Money?
Net Profit Margin
For every $100 in sales, Progress Software Corporation keeps $8.61 as profit after all expenses.
Operating Margin
Core operations generate 17.23 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $17.82 in profit for every $100 of shareholder equity.
ROA
Progress Software Corporation generates $3.55 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Progress Software Corporation generates strong operating cash flow of $264.39M, reflecting robust business health.
Free Cash Flow
Progress Software Corporation generates strong free cash flow of $257.28M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $6.11 in free cash annually.
FCF Yield
PRGS converts 22.52% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
13.48
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.26
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.30
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.16
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.74
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.47
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.18
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.11
vs 25 benchmark
How PRGS Stacks Against Its Sector Peers
| Metric | PRGS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 13.48 | 37.39 | Better (Cheaper) |
| ROE | 17.82% | 986.00% | Weak |
| Net Margin | 8.61% | 5872992870.00% | Weak |
| Debt/Equity | 1.74 | 0.34 | Weak (High Leverage) |
| Current Ratio | 0.47 | 5.10 | Weak Liquidity |
| ROA | 3.55% | -293612.00% (disorted) | Weak |
PRGS outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Progress Software Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
130.88%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
-4.23%
Industry Style: Growth, Innovation, High Beta
DecliningFCF CAGR
69.51%
Industry Style: Growth, Innovation, High Beta
High Growth