DB:NAI

Stock Analysis Report

Executive Summary

NIC Inc., together with its subsidiaries, provides digital government services that enable governments to use technology to provide various services to businesses and citizens in the United States.


Snowflake Analysis

Flawless balance sheet with acceptable track record.


Similar Companies

Share Price & News

How has NIC's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NAI's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

7.3%

NAI

3.4%

DE IT

2.2%

DE Market


1 Year Return

34.9%

NAI

4.4%

DE IT

-17.2%

DE Market

Return vs Industry: NAI exceeded the German IT industry which returned -0% over the past year.

Return vs Market: NAI exceeded the German Market which returned -17.5% over the past year.


Shareholder returns

NAIIndustryMarket
7 Day7.3%3.4%2.2%
30 Day24.8%-9.2%-15.7%
90 Day3.5%-10.4%-24.0%
1 Year37.3%34.9%5.1%4.4%-14.9%-17.2%
3 Year17.5%10.9%81.5%76.0%-16.4%-23.3%
5 Year44.6%28.7%167.3%156.0%-16.5%-27.8%

Price Volatility Vs. Market

How volatile is NIC's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is NIC undervalued compared to its fair value and its price relative to the market?

30.66x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NAI (€20.6) is trading above our estimate of fair value (€16.02)

Significantly Below Fair Value: NAI is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NAI is poor value based on its PE Ratio (30.7x) compared to the IT industry average (25.7x).

PE vs Market: NAI is poor value based on its PE Ratio (30.7x) compared to the German market (16.3x).


Price to Earnings Growth Ratio

PEG Ratio: NAI is poor value based on its PEG Ratio (2.8x)


Price to Book Ratio

PB vs Industry: NAI is overvalued based on its PB Ratio (6.2x) compared to the DE IT industry average (3.2x).


Next Steps

Future Growth

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

11.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NAI's forecast earnings growth (11% per year) is above the savings rate (-0.4%).

Earnings vs Market: NAI's earnings (11% per year) are forecast to grow slower than the German market (14.4% per year).

High Growth Earnings: NAI's earnings are forecast to grow, but not significantly.

Revenue vs Market: NAI's revenue (8.5% per year) is forecast to grow faster than the German market (4.1% per year).

High Growth Revenue: NAI's revenue (8.5% 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 NAI's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has NIC performed over the past 5 years?

6.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NAI has high quality earnings.

Growing Profit Margin: NAI's current net profit margins (14.1%) are lower than last year (16.7%).


Past Earnings Growth Analysis

Earnings Trend: NAI's earnings have grown by 6.3% per year over the past 5 years.

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

Earnings vs Industry: NAI had negative earnings growth (-13.5%) over the past year, making it difficult to compare to the IT industry average (2.5%).


Return on Equity

High ROE: NAI's Return on Equity (20.5%) is considered high.


Next Steps

Financial Health

How is NIC's financial position?


Financial Position Analysis

Short Term Liabilities: NAI's short term assets ($312.7M) exceed its short term liabilities ($100.6M).

Long Term Liabilities: NAI's short term assets ($312.7M) exceed its long term liabilities ($15.8M).


Debt to Equity History and Analysis

Debt Level: NAI is debt free.

Reducing Debt: NAI has not had any debt for past 5 years.

Debt Coverage: NAI has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: NAI has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: NAI has a low level of unsold assets or inventory.

Debt Coverage by Assets: NAI's debt is not covered by short term assets (assets are -1.7604739828377E+17x debt).


Next Steps

Dividend

What is NIC's current dividend yield, its reliability and sustainability?

1.57%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: NAI's dividend (1.57%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.68%).

High Dividend: NAI's dividend (1.57%) is low compared to the top 25% of dividend payers in the German market (4.97%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (42.9%), NAI's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

3.8yrs

Average management tenure


CEO

Harry Herington (59yo)

12s

Tenure

US$2,420,154

Compensation

Mr. Harry H. Herington has been the Chairman of the Board at NIC Inc. since May 6, 2008 and as its Chief Executive Officer since February 4, 2008. Mr. Herington also serves as the President of National Inf ...


CEO Compensation Analysis

Compensation vs Market: Harry's total compensation ($USD2.42M) is above average for companies of similar size in the German market ($USD1.85M).

Compensation vs Earnings: Harry's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Harry Herington
Chairman of the Board & CEO12yrsUS$2.42m1.3% $18.5m
Stephen Kovzan
Chief Financial Officer12.58yrsUS$1.04m0.25% $3.6m
William Van Asselt
General Counsel & Secretary4.17yrsUS$507.01k0.043% $604.1k
Jayne Holland
Chief Security Officer13.25yrsUS$948.55k0.18% $2.5m
Douglas Rogers
Senior Vice President of Business Development2.42yrsUS$578.44k0.021% $291.3k
Brian Anderson
Chief Technology Officer0.83yrno data0.016% $225.2k
Angie Davids
Senior Vice President of Marketing & Communications0.42yrno datano data
Ron Thornburgh
Vice President of Digital Government & Advocacy3.42yrsUS$521.17kno data
Elizabeth Thomas
Vice President of Finance Operationsno datano datano data

3.8yrs

Average Tenure

52.5yo

Average Age

Experienced Management: NAI's management team is considered experienced (3.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Harry Herington
Chairman of the Board & CEO12yrsUS$2.42m1.3% $18.5m
Peter Wilson
Independent Director20.67yrsUS$155.69k0.13% $1.9m
Alexander Kemper
Independent Director12.25yrsUS$164.44k0.087% $1.2m
William Lyons
Independent Director10.58yrsUS$161.94k0.091% $1.3m
Art Burtscher
Lead Independent Director12yrsUS$176.94k0.35% $5.0m
Anthony Scott
Independent Director1.67yrsUS$157.80k0.011% $157.3k
Charles Henry
Independent Director8.42yrsUS$155.69k0.063% $896.8k
Venmal Arasu
Independent Director4.83yrsUS$158.19k0.042% $602.2k
Jayaprakash Vijayan
Independent Director1.67yrsUS$159.05k0.011% $157.3k

10.6yrs

Average Tenure

59yo

Average Age

Experienced Board: NAI's board of directors are seasoned and experienced ( 10.6 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if 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.


Top Shareholders

Company Information

NIC Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: NIC Inc.
  • Ticker: NAI
  • Exchange: DB
  • Founded: 1991
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$1.560b
  • Listing Market Cap: US$1.420b
  • Shares outstanding: 67.83m
  • Website: https://www.egov.com

Number of Employees


Location

  • NIC Inc.
  • 25501 West Valley Parkway
  • Suite 300
  • Olathe
  • Kansas
  • 66061
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EGOVNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 1999
NAIDB (Deutsche Boerse AG)YesCommon StockDEEURJul 1999
0K48LSE (London Stock Exchange)YesCommon StockGBUSDJul 1999

Biography

NIC Inc., together with its subsidiaries, provides digital government services that enable governments to use technology to provide various services to businesses and citizens in the United States. Its portals consist websites and applications that enable businesses and citizens to access government information through online channels, such as applying for a permit, retrieving government records, or filing a government-mandated form or report. The company’s portal service offerings include motor vehicle driver history record retrieval; vehicle title, lien, and registration; motor vehicle inspections; temporary vehicle tags; driver’s license renewal; hunting and fishing licenses; health professional license services; professional license renewal; business registrations and renewals; secretary of state business searches; Uniform Commercial Code (UCC) searches and filings; limited criminal history searches; court services; vital records; income and property tax payments; and payment processing products and services. Its software & services business provides software development, payment processing, and other digital government services to state and local governments, as well as federal agencies. In addition, the company develops and manages the pre-employment screening program for motor carriers using transaction-based business model. Further, it offers application development and portal management services to governments. NIC Inc. was founded in 1991 and is based in Olathe, Kansas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/31 22:31
End of Day Share Price2020/03/31 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.