Sylogist (TSX:SYZ) - Share price, News & Analysis

Q: What is the Fair Price of SYZ when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

SYZ (CA$7.21) is trading below our estimate of [[fair value]] (CA$11.65)

SYZ fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	1/6
Past Performance	0/6
Financial Health	4/6
Dividends	3/6

SYZ Stock Overview

Sylogist Ltd., a software company, provides enterprise resource planning (ERP) solutions in Canada, the United States, the United Kingdom, and internationally.

Rewards

Trading at 38.1% below our estimate of its fair value

Revenue is forecast to grow 12.33% per year

Risk Analysis

Earnings are forecast to decline by an average of 32.4% per year for the next 3 years

Dividend of 6.93% is not well covered by earnings or forecast to be in the next 3 years

Large one-off items impacting financial results

Profit margins (4.1%) are lower than last year (22.2%)

Sylogist Competitors

Tecsys

TSX:TCS

CA$558.1m

Route1

TSXV:ROI

CA$4.6m

WeCommerce Holdings

TSXV:WE

CA$119.8m

Optiva

TSX:OPT

CA$148.2m

Price History & Performance

Summary of all time highs, changes and price drops for Sylogist
Historical stock prices
Current Share Price	CA$7.21
52 Week High	CA$13.24
52 Week Low	CA$6.12
Beta	0.80
1 Month Change	3.15%
3 Month Change	0.70%
1 Year Change	-39.97%
3 Year Change	-37.79%
5 Year Change	-18.07%
Change since IPO	7.29%

Recent News & Updates

Jul 16

What Is Sylogist Ltd.'s (TSE:SYZ) Share Price Doing?

Sylogist Ltd. ( TSE:SYZ ), is not the largest company out there, but it received a lot of attention from a substantial...

May 29

Sylogist (TSE:SYZ) Will Pay A Dividend Of CA$0.13

Sylogist Ltd.'s ( TSE:SYZ ) investors are due to receive a payment of CA$0.13 per share on 15th of June. The dividend...

Shareholder Returns

	SYZ	CA Software	CA Market
7D	1.0%	2.6%	-0.4%
1Y	-40.0%	-26.0%	-1.2%

Return vs Industry: SYZ underperformed the Canadian Software industry which returned -26.3% over the past year.

Return vs Market: SYZ underperformed the Canadian Market which returned -2% over the past year.

Price Volatility

Is SYZ's price volatile compared to industry and market?
SYZ volatility
SYZ Average Weekly Movement	6.8%
Software Industry Average Movement	13.5%
Market Average Movement	10.8%
10% most volatile stocks in CA Market	19.3%
10% least volatile stocks in CA Market	4.4%

Stable Share Price: SYZ is less volatile than 75% of Canadian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: SYZ's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1993	n/a	Bill Wood	https://www.sylogist.com

Sylogist Ltd., a software company, provides enterprise resource planning (ERP) solutions in Canada, the United States, the United Kingdom, and internationally. It offers Serenic Navigator solutions, including accounting and financial management, award and budget management, payroll and human resources, analytics and decision support, reporting, deposits and loans, and field connect products. The company also provides NaviPayroll, an integrated payroll management and human resources solution; NaviTrak, a manufacturing and distribution solution; and NaviView terminal, a touch-screen terminal that runs various application.

Sylogist Fundamentals Summary

How do Sylogist's earnings and revenue compare to its market cap?
SYZ fundamental statistics
Market Cap	CA$172.43m
Earnings (TTM)	CA$1.90m
Revenue (TTM)	CA$46.02m

90.8x

P/E Ratio

3.7x

P/S Ratio

Is SYZ overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SYZ income statement (TTM)
Revenue	CA$46.02m
Cost of Revenue	CA$14.73m
Gross Profit	CA$31.29m
Other Expenses	CA$29.39m
Earnings	CA$1.90m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Aug 11, 2022

Earnings per share (EPS)	0.079
Gross Margin	68.00%
Net Profit Margin	4.13%
Debt/Equity Ratio	62.7%

How did SYZ perform over the long term?

See historical performance and comparison

Dividends

6.9%

Current Dividend Yield

629%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is SYZ undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SYZ?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SYZ. This is calculated by dividing SYZ's market cap by their current preferred multiple.
What is SYZ's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	CA$172.43m

SYZ key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	4x
Enterprise Value/EBITDA	15.6x
PEG Ratio	-2.8x

Price to Earnings Ratio vs Peers

How does SYZ's PE Ratio compare to its peers?

SYZ PE Ratio vs Peers

The above table shows the PE ratio for SYZ vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	70.1x
TCS Tecsys	124.6x	39.2%	CA$558.1m
ROI Route1	53.7x	n/a	CA$4.6m
WE WeCommerce Holdings	70.3x	-49.8%	CA$119.8m
OPT Optiva	31.7x	n/a	CA$148.2m
SYZ Sylogist	90.8x	-32.4%	CA$172.4m

Price-To-Earnings vs Peers: SYZ is expensive based on its Price-To-Earnings Ratio (90.8x) compared to the peer average (70.1x).

Price to Earnings Ratio vs Industry

How does SYZ's PE Ratio compare vs other companies in the CA Software Industry?

Price-To-Earnings vs Industry: SYZ is expensive based on its Price-To-Earnings Ratio (90.8x) compared to the Canadian Software industry average (51.4x)

Price to Earnings Ratio vs Fair Ratio

What is SYZ's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SYZ PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	90.8x
Fair PE Ratio	12.7x

Price-To-Earnings vs Fair Ratio: SYZ is expensive based on its Price-To-Earnings Ratio (90.8x) compared to the estimated Fair Price-To-Earnings Ratio (12.7x).

Share Price vs Fair Value

What is the Fair Price of SYZ when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SYZ (CA$7.21) is trading below our estimate of fair value (CA$11.65)

Significantly Below Fair Value: SYZ is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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Future Growth

How is Sylogist forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-32.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SYZ's earnings are forecast to decline over the next 3 years (-32.4% per year).

Earnings vs Market: SYZ's earnings are forecast to decline over the next 3 years (-32.4% per year).

High Growth Earnings: SYZ's earnings are forecast to decline over the next 3 years.

Revenue vs Market: SYZ's revenue (12.3% per year) is forecast to grow faster than the Canadian market (6.5% per year).

High Growth Revenue: SYZ's revenue (12.3% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if SYZ's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has Sylogist performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-18.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SYZ has a large one-off loss of CA$1.0M impacting its March 31 2022 financial results.

Growing Profit Margin: SYZ's current net profit margins (4.1%) are lower than last year (22.2%).

Past Earnings Growth Analysis

Earnings Trend: SYZ's earnings have declined by 18.9% per year over the past 5 years.

Accelerating Growth: SYZ's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SYZ had negative earnings growth (-77.5%) over the past year, making it difficult to compare to the Software industry average (26.3%).

Return on Equity

High ROE: SYZ's Return on Equity (4.6%) is considered low.

Discover strong past performing companies

Financial Health

How is Sylogist's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: SYZ's short term assets (CA$24.0M) do not cover its short term liabilities (CA$47.4M).

Long Term Liabilities: SYZ's short term assets (CA$24.0M) exceed its long term liabilities (CA$16.3M).

Debt to Equity History and Analysis

Debt Level: SYZ's net debt to equity ratio (21.6%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if SYZ's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: SYZ's debt is well covered by operating cash flow (53.9%).

Interest Coverage: SYZ's interest payments on its debt are well covered by EBIT (8x coverage).

Balance Sheet

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Dividend

What is Sylogist current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

6.93%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: SYZ's dividend (6.93%) is higher than the bottom 25% of dividend payers in the Canadian market (1.96%).

High Dividend: SYZ's dividend (6.93%) is in the top 25% of dividend payers in the Canadian market (5.36%)

Stability and Growth of Payments

Stable Dividend: SYZ's dividend payments have been volatile in the past 10 years.

Growing Dividend: SYZ's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its high payout ratio (629.3%), SYZ's dividend payments are not well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (94.9%), SYZ's dividend payments are not well covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

1.7yrs

Average management tenure

CEO

Bill Wood (59 yo)

1.75yrs

Tenure

CA$2,854,472

Compensation

Mr. William C. Wood, also known as Bill, has been President, Chief Executive Officer and Director of Sylogist Ltd. since November 9, 2020. He had been the President and Chief Executive Officer of FrontStre...

CEO Compensation Analysis

Compensation vs Market: Bill's total compensation ($USD2.22M) is above average for companies of similar size in the Canadian market ($USD185.39K).

Compensation vs Earnings: Insufficient data to compare Bill's compensation with company performance.

Leadership Team

Experienced Management: SYZ's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.

Board Members

Experienced Board: SYZ's board of directors are not considered experienced ( 1.9 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: SYZ insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/08 00:00
End of Day Share Price	2022/08/08 00:00
Earnings	2022/03/31
Annual Earnings	2021/09/30