Is Xero Limited (ASX:XRO) Worth AU$125 Based On Its Intrinsic Value?
May 22
Australian (ASX) Software Industry Analysis
UpdatedMay 22, 2024
DataAggregated Company Financials
Companies84
- 7D2.1%
- 3M9.9%
- 1Y28.5%
- YTD22.7%
The Software industry is up 2.3% in the last week, with WiseTech Global up 2.6%. Meanwhile, FINEOS Corporation Holdings actually underperformed within the industry, shrinking 15% in the last week. In the last 12 months, the industry was up 30%. As for the next few years, earnings are expected to grow by 34% per annum.
Industry Valuation and Performance
Has the Australian Software Industry valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE | Absolute PE | PS |
|---|---|---|---|---|---|---|
| Thu, 23 May 2024 | AU$83.0b | AU$7.6b | -AU$298,229,758.36 | 61.1x | -278.4x | 10.9x |
| Sat, 20 Apr 2024 | AU$77.7b | AU$7.6b | -AU$369,363,646.27 | 63.4x | -210.5x | 10.2x |
| Mon, 18 Mar 2024 | AU$81.5b | AU$7.6b | -AU$389,580,353.88 | 60.9x | -209.1x | 10.7x |
| Wed, 14 Feb 2024 | AU$68.9b | AU$7.6b | -AU$767,588,849.58 | 56.4x | -89.8x | 9x |
| Fri, 12 Jan 2024 | AU$68.0b | AU$8.4b | -AU$1,047,590,035.00 | 59.1x | -64.9x | 8.1x |
| Sun, 10 Dec 2023 | AU$65.4b | AU$8.4b | -AU$1,048,232,749.00 | 60.4x | -62.3x | 7.8x |
| Tue, 07 Nov 2023 | AU$63.1b | AU$8.2b | -AU$1,166,109,920.00 | 54.4x | -54.2x | 7.7x |
| Thu, 05 Oct 2023 | AU$65.2b | AU$8.1b | -AU$1,118,337,367.00 | 58.6x | -58.3x | 8.1x |
| Sat, 02 Sep 2023 | AU$70.3b | AU$8.1b | -AU$1,114,325,888.00 | 63.4x | -63.1x | 8.7x |
| Mon, 31 Jul 2023 | AU$74.5b | AU$7.7b | -AU$891,151,253.00 | 52.5x | -83.6x | 9.7x |
| Wed, 28 Jun 2023 | AU$67.9b | AU$7.7b | -AU$900,968,050.00 | 46.2x | -75.4x | 8.8x |
| Fri, 26 May 2023 | AU$66.0b | AU$7.7b | -AU$937,497,940.00 | 44.6x | -70.4x | 8.5x |
| Sun, 23 Apr 2023 | AU$61.9b | AU$7.5b | -AU$871,787,746.00 | 47.3x | -71x | 8.3x |
| Tue, 21 Mar 2023 | AU$57.7b | AU$7.5b | -AU$870,615,475.00 | 44.5x | -66.3x | 7.7x |
| Thu, 16 Feb 2023 | AU$56.8b | AU$7.1b | -AU$714,345,781.00 | 53.9x | -79.5x | 8x |
| Sat, 14 Jan 2023 | AU$53.7b | AU$7.1b | -AU$708,884,628.00 | 51.9x | -75.7x | 7.6x |
| Mon, 12 Dec 2022 | AU$53.9b | AU$7.1b | -AU$713,606,099.00 | 51.3x | -75.6x | 7.6x |
| Wed, 09 Nov 2022 | AU$54.0b | AU$6.9b | -AU$710,455,716.00 | 51x | -76x | 7.8x |
| Fri, 07 Oct 2022 | AU$55.7b | AU$6.9b | -AU$667,225,894.00 | 48.2x | -83.5x | 8.1x |
| Sun, 04 Sep 2022 | AU$56.7b | AU$6.8b | -AU$648,644,657.00 | 53.1x | -87.4x | 8.3x |
| Tue, 02 Aug 2022 | AU$56.0b | AU$6.4b | -AU$464,165,517.00 | 26.2x | -120.7x | 8.8x |
| Thu, 30 Jun 2022 | AU$47.2b | AU$6.4b | -AU$465,661,693.00 | 25.2x | -101.3x | 7.4x |
| Sat, 28 May 2022 | AU$52.3b | AU$6.3b | -AU$426,700,370.00 | 25.6x | -122.5x | 8.2x |
| Mon, 25 Apr 2022 | AU$57.1b | AU$6.2b | -AU$439,248,575.00 | 30.7x | -130.1x | 9.3x |
| Wed, 23 Mar 2022 | AU$59.4b | AU$6.2b | -AU$440,048,329.00 | 36x | -134.9x | 9.6x |
| Fri, 18 Feb 2022 | AU$61.4b | AU$5.9b | -AU$305,881,973.00 | 44.1x | -200.9x | 10.4x |
| Sun, 16 Jan 2022 | AU$67.2b | AU$5.7b | -AU$142,324,252.00 | 44.2x | -472.2x | 11.8x |
| Tue, 14 Dec 2021 | AU$71.7b | AU$5.5b | -AU$149,885,239.00 | 40.5x | -478.1x | 13x |
| Thu, 11 Nov 2021 | AU$73.5b | AU$5.4b | -AU$108,272,098.00 | 46.2x | -678.9x | 13.6x |
| Sat, 09 Oct 2021 | AU$68.8b | AU$5.5b | -AU$133,902,502.00 | 44x | -513.6x | 12.6x |
| Mon, 06 Sep 2021 | AU$70.4b | AU$5.3b | -AU$115,869,683.57 | 43.8x | -607.3x | 13.2x |
| Wed, 04 Aug 2021 | AU$63.5b | AU$5.4b | -AU$118,915,907.78 | 44.7x | -533.8x | 11.8x |
Price to Earnings Ratio
-477.5x
Current Industry PE
- Investors are optimistic on the Australian Software industry, and appear confident in long term growth rates.
- The 3-year average PS ratio of 9.5x is lower than the industry's current PS ratio of 10.9x.
Past Earnings Growth
- The earnings for companies in the Software industry have deteriorated over the last three years.
- Meanwhile revenues for these companies have grown 13% per year.
- This means that although more sales are being generated, either the cost of doing business or the level of investment back into businesses has increased, which has caused losses to expand.
Industry Trends
Which industries have driven the changes within the Australian Tech industry?
| AU Market | 1.47% | |
| Tech | 1.38% | |
| Software | 2.10% | |
| Application Software | 2.13% | |
| Systems Software | -1.31% | |
Industry PE
Forecasted Growth
- Analysts are most optimistic on the Systems Software industry, expecting annual earnings growth of 70% over the next 5 years.
- In contrast, the Application Software industry is expected to see its earnings grow by 34% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | |
|---|---|---|---|---|---|
| WTC WiseTech Global | AU$100.03 | 2.6% +AU$846.9m | 37.2% | PE149.5x | |
| TNE Technology One | AU$17.86 | 10.4% +AU$547.0m | 12.3% | PE53.1x | |
| XRO Xero | AU$124.00 | 1.9% +AU$348.8m | 14.0% | PS13.3x | |
| NXL Nuix | AU$3.02 | 28.5% +AU$216.8m | 217.9% | PS5.1x | |
| 360 Life360 | AU$15.82 | 4.5% +AU$142.0m | 139.7% | PS7x |
