KASE:SYS

Stock Analysis Report

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Executive Summary

Systems Limited engages in the software development, trading of software, and business process outsourcing (BPO) activities in North America, the Middle East, and Pakistan. More Details


Snowflake Analysis

Excellent balance sheet with proven track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: SYS is not significantly more volatile than the rest of PK stocks over the past 3 months, typically moving +/- 7% a week.

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


Market Performance


7 Day Return

4.6%

SYS

1.3%

PK IT

-0.4%

PK Market


1 Year Return

220.2%

SYS

30.2%

PK IT

0.3%

PK Market

Return vs Industry: SYS exceeded the PK IT industry which returned 31.3% over the past year.

Return vs Market: SYS exceeded the PK Market which returned 0.4% over the past year.


Shareholder returns

SYSIndustryMarket
7 Day4.6%1.3%-0.4%
30 Day14.0%0.6%-4.0%
90 Day55.8%8.3%-3.0%
1 Year224.9%220.2%32.3%30.2%4.4%0.3%
3 Year467.1%438.2%63.7%56.2%-3.1%-15.0%
5 Year630.2%562.4%59.3%48.4%24.2%-2.1%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

22.19x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SYS (PKR352.27) is trading above our estimate of fair value (PKR175.98)

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


Price To Earnings Ratio

PE vs Industry: SYS is good value based on its PE Ratio (22.2x) compared to the XA IT industry average (25.5x).

PE vs Market: SYS is poor value based on its PE Ratio (22.2x) compared to the PK market (9.9x).


Price to Earnings Growth Ratio

PEG Ratio: SYS is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: SYS is overvalued based on its PB Ratio (6.1x) compared to the XA IT industry average (2.3x).


Next Steps

Future Growth

How is Systems forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

7.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SYS's forecast earnings growth (7.3% per year) is below the savings rate (9.7%).

Earnings vs Market: SYS's earnings (7.3% per year) are forecast to grow slower than the PK market (8.4% per year).

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

Revenue vs Market: SYS's revenue (12.3% per year) is forecast to grow faster than the PK market (8% per year).

High Growth Revenue: SYS'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: SYS's Return on Equity is forecast to be high in 3 years time (27%)


Next Steps

Past Performance

How has Systems performed over the past 5 years?

35.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SYS has high quality earnings.

Growing Profit Margin: SYS's current net profit margins (21.7%) are lower than last year (22.8%).


Past Earnings Growth Analysis

Earnings Trend: SYS's earnings have grown significantly by 35.7% per year over the past 5 years.

Accelerating Growth: SYS's earnings growth over the past year (22.4%) is below its 5-year average (35.7% per year).

Earnings vs Industry: SYS earnings growth over the past year (22.4%) exceeded the IT industry 8.3%.


Return on Equity

High ROE: SYS's Return on Equity (25.9%) is considered high.


Next Steps

Financial Health

How is Systems's financial position?


Financial Position Analysis

Short Term Liabilities: SYS's short term assets (PKR8.3B) exceed its short term liabilities (PKR2.3B).

Long Term Liabilities: SYS's short term assets (PKR8.3B) exceed its long term liabilities (PKR309.1M).


Debt to Equity History and Analysis

Debt Level: SYS's debt to equity ratio (19.1%) is considered satisfactory.

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

Debt Coverage: SYS's debt is well covered by operating cash flow (158.3%).

Interest Coverage: SYS's interest payments on its debt are well covered by EBIT (74.7x coverage).


Balance Sheet


Next Steps

Dividend

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

0.64%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SYS's dividend (0.64%) isn’t notable compared to the bottom 25% of dividend payers in the PK market (2.25%).

High Dividend: SYS's dividend (0.64%) is low compared to the top 25% of dividend payers in the PK market (8.09%).


Stability and Growth of Payments

Stable Dividend: SYS is not paying a notable dividend for the PK market, therefore no need to check if payments are stable.

Growing Dividend: SYS is not paying a notable dividend for the PK market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: SYS is not paying a notable dividend for the PK market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SYS's dividend in 3 years as they are not forecast to pay a notable one for the PK market.


Next Steps

Management

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

5.3yrs

Average management tenure


CEO

Muhammad Peer

7.83yrs

Tenure

Mr. Muhammad Asif Peer has been the Chief Executive Officer and Managing Director of Systems Limited since January 1, 2013. Mr. Peer served as Senior Vice President of Services at Visionet Systems Inc. and...


Leadership Team

NamePositionTenureCompensationOwnership
Aezaz Hussain
Founder & Non Executive Chairmanno datano data13.07%
PKR 5.7b
Muhammad Peer
CEO, MD & Executive Director7.83yrsno data5.77%
PKR 2.5b
Roohi Khan
Chief Financial Officer2.75yrsno datano data
Toima Asghar
Chief Human Resource Officerno datano datano data
Salman Wajid Mian
Chief Process Outsourcing Officer5.33yrsno datano data
Saad Aslam
Company Secretary2.08yrsno datano data

5.3yrs

Average Tenure

Experienced Management: SYS's management team is seasoned and experienced (5.3 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.


Ownership Breakdown

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


Top Shareholders

Company Information

Systems Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Systems Limited
  • Ticker: SYS
  • Exchange: KASE
  • Founded: 1977
  • Industry: IT Consulting and Other Services
  • Sector: Software
  • Market Cap: PK₨43.895b
  • Shares outstanding: 124.61m
  • Website: https://www.systemsltd.com

Number of Employees


Location

  • Systems Limited
  • Ex-Air Avenue
  • E-1, Sehjpal
  • Lahore
  • Pakistan

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SYSKASE (Pakistan Stock Exchange Limited)YesOrdinary SharesPKPKRFeb 2015

Biography

Systems Limited engages in the software development, trading of software, and business process outsourcing (BPO) activities in North America, the Middle East, and Pakistan. The company offers solutions in ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/26 13:31
End of Day Share Price2020/11/25 00:00
Earnings2020/09/30
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.