ANSYS (NasdaqGS:ANSS) - Share price, News & Analysis

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

ANSS ($282.65) is trading below our estimate of [[fair value]] ($297.08)

ANSS fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	3/6
Past Performance	2/6
Financial Health	5/6
Dividends	0/6

ANSS Stock Overview

ANSYS, Inc. develops and markets engineering simulation software and services worldwide.

Rewards

Trading at 4.9% below our estimate of its fair value

Earnings are forecast to grow 13.96% per year

Earnings have grown 10.3% per year over the past 5 years

Risk Analysis

Significant insider selling over the past 3 months

ANSYS Competitors

Paycom Software

NYSE:PAYC

US$21.3b

Tyler Technologies

NYSE:TYL

US$17.2b

PTC

NasdaqGS:PTC

US$14.0b

Paylocity Holding

NasdaqGS:PCTY

US$14.4b

Price History & Performance

Summary of all time highs, changes and price drops for ANSYS
Historical stock prices
Current Share Price	US$282.65
52 Week High	US$413.89
52 Week Low	US$225.92
Beta	1.29
1 Month Change	13.22%
3 Month Change	12.77%
1 Year Change	-23.94%
3 Year Change	36.52%
5 Year Change	125.69%
Change since IPO	9,420.84%

Shareholder Returns

	ANSS	US Software	US Market
7D	1.2%	1.8%	1.1%
1Y	-23.9%	-17.8%	-13.0%

Return vs Industry: ANSS underperformed the US Software industry which returned -17.7% over the past year.

Return vs Market: ANSS underperformed the US Market which returned -12.9% over the past year.

Price Volatility

Is ANSS's price volatile compared to industry and market?
ANSS volatility
ANSS Average Weekly Movement	6.2%
Software Industry Average Movement	10.7%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.1%
10% least volatile stocks in US Market	3.2%

Stable Share Price: ANSS is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: ANSS's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1970	5,300	Ajei Gopal	https://www.ansys.com

ANSYS, Inc. develops and markets engineering simulation software and services worldwide. It offers ANSYS Workbench, a framework upon which its multiphysics engineering simulation technologies are built and enables engineers to simulate the interactions between structures, heat transfer, fluids, electronics, and optical elements in a unified engineering simulation environment; high-performance computing product suite; power analysis and optimization software suite that manages the power budget, power delivery integrity, and power-induced noise in an electronic design; and structural analysis product suite that provides simulation tools for product design and optimization. The company also provides electronics product suite that offers field simulation software for designing electronic and electromechanical products; SCADE product suite, a solution for embedded software simulation, code production, and automated certification; fluids product suite that enables modeling of fluid flow and other related physical phenomena; Ansys Granta products to give access to material intelligence; photonic design and simulation tools; and optical sensor and closed-loop, and real-time simulation, as well as safety-certified embedded software solutions.

ANSYS Fundamentals Summary

How do ANSYS's earnings and revenue compare to its market cap?
ANSS fundamental statistics
Market Cap	US$24.61b
Earnings (TTM)	US$458.30m
Revenue (TTM)	US$2.00b

53.7x

P/E Ratio

12.3x

P/S Ratio

Is ANSS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
ANSS income statement (TTM)
Revenue	US$2.00b
Cost of Revenue	US$193.52m
Gross Profit	US$1.80b
Other Expenses	US$1.34b
Earnings	US$458.30m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	5.26
Gross Margin	90.30%
Net Profit Margin	22.96%
Debt/Equity Ratio	16.9%

How did ANSS perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

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

Valuation Score

2/6

Valuation Score 2/6

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 ANSS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for ANSS. This is calculated by dividing ANSS's market cap by their current preferred multiple.
What is ANSS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$24.61b

ANSS 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	12.5x
Enterprise Value/EBITDA	37.1x
PEG Ratio	3.8x

Price to Earnings Ratio vs Peers

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

ANSS PE Ratio vs Peers

The above table shows the PE ratio for ANSS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	93.9x
PAYC Paycom Software	93.3x	23.7%	US$21.3b
TYL Tyler Technologies	96x	16.9%	US$17.2b
PTC PTC	28.1x	17.0%	US$14.0b
PCTY Paylocity Holding	158.4x	23.0%	US$14.4b
ANSS ANSYS	53.7x	14.0%	US$24.6b

Price-To-Earnings vs Peers: ANSS is good value based on its Price-To-Earnings Ratio (53.7x) compared to the peer average (93.9x).

Price to Earnings Ratio vs Industry

How does ANSS's PE Ratio compare vs other companies in the US Software Industry?

Price-To-Earnings vs Industry: ANSS is expensive based on its Price-To-Earnings Ratio (53.7x) compared to the US Software industry average (44.9x)

Price to Earnings Ratio vs Fair Ratio

What is ANSS'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.

ANSS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	53.7x
Fair PE Ratio	36.1x

Price-To-Earnings vs Fair Ratio: ANSS is expensive based on its Price-To-Earnings Ratio (53.7x) compared to the estimated Fair Price-To-Earnings Ratio (36.1x).

Share Price vs Fair Value

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

Below Fair Value: ANSS ($282.65) is trading below our estimate of fair value ($297.08)

Significantly Below Fair Value: ANSS is trading below fair value, but not by a significant amount.

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 less than 20% higher than the current share price.

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Future Growth

How is ANSYS forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

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

14.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: ANSS's forecast earnings growth (14% per year) is above the savings rate (1.9%).

Earnings vs Market: ANSS's earnings (14% per year) are forecast to grow faster than the US market (12.8% per year).

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

Revenue vs Market: ANSS's revenue (8.3% per year) is forecast to grow faster than the US market (8% per year).

High Growth Revenue: ANSS's revenue (8.3% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: ANSS's Return on Equity is forecast to be low in 3 years time (15.6%).

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Past Performance

How has ANSYS performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

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

10.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: ANSS has high quality earnings.

Growing Profit Margin: ANSS's current net profit margins (23%) are lower than last year (25.4%).

Past Earnings Growth Analysis

Earnings Trend: ANSS's earnings have grown by 10.3% per year over the past 5 years.

Accelerating Growth: ANSS's earnings growth over the past year (0.2%) is below its 5-year average (10.3% per year).

Earnings vs Industry: ANSS earnings growth over the past year (0.2%) underperformed the Software industry 18.5%.

Return on Equity

High ROE: ANSS's Return on Equity (10.3%) is considered low.

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Financial Health

How is ANSYS's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

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

Financial Position Analysis

Short Term Liabilities: ANSS's short term assets ($1.3B) exceed its short term liabilities ($624.7M).

Long Term Liabilities: ANSS's short term assets ($1.3B) exceed its long term liabilities ($1.0B).

Debt to Equity History and Analysis

Debt Level: ANSS's net debt to equity ratio (5.3%) is considered satisfactory.

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

Debt Coverage: ANSS's debt is well covered by operating cash flow (78.2%).

Interest Coverage: ANSS's interest payments on its debt are well covered by EBIT (49x coverage).

Balance Sheet

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Dividend

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

Dividend Score

0/6

Dividend Score 0/6

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

Dividend Yield vs Market

Notable Dividend: Unable to evaluate ANSS's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate ANSS's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ANSS's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ANSS's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as ANSS has not reported any payouts.

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Management

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

3.6yrs

Average management tenure

CEO

Ajei Gopal (60 yo)

6yrs

Tenure

US$18,260,634

Compensation

Dr. Ajei S. Gopal, Ph D., had been an Independent Director of Citrix Systems, Inc. since September 20, 2017 until October 4, 2021. He has been the Chief Executive Officer of Ansys, Inc. since January 1, 20...

CEO Compensation Analysis

Compensation vs Market: Ajei's total compensation ($USD18.26M) is above average for companies of similar size in the US market ($USD12.96M).

Compensation vs Earnings: Ajei's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: ANSS's management team is considered experienced (3.6 years average tenure).

Board Members

Experienced Board: ANSS's board of directors are considered experienced (4.1 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: ANSS insiders have only sold shares 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	2022/06/30
Annual Earnings	2021/12/31