Bentley Systems (BSY): Exploring Valuation After Recent Share Price Volatility

Bentley Systems (BSY) has captured the attention of investors lately as its shares have shown some volatility over the past month. After a recent dip, many are weighing its long-term performance in relation to its current valuation.

See our latest analysis for Bentley Systems.

While Bentley Systems’ share price recently dipped, its longer-term momentum remains intact, with a year-to-date share price return of 9.31% and a one-year total shareholder return of 5.59%. Investors are watching closely to see if confidence continues to build after these moves, as the company’s multi-year total shareholder return of 56.02% over three years still stands out.

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Yet with recent volatility and substantial long-term gains, the question remains: is Bentley Systems actually undervalued right now, or has the market already factored in all of its future growth potential?

Most Popular Narrative: 14% Undervalued

Despite some recent share price declines, the prevailing narrative values Bentley Systems at $59.08 per share, implying notable upside from the last close at $50.83. This valuation assumes trends and opportunities in the industry will play out in Bentley’s favor and fuel growth beyond current market expectations.

Sustained global investment in infrastructure, driven by government initiatives in the US, UK, EU, and high-growth regions like India and the Middle East, continues to expand Bentley's addressable market. This supports durable double-digit ARR and revenue growth. Large-scale productivity challenges (such as the shortage of skilled engineers) are forcing the sector to accelerate digital transformation. This elevates demand for Bentley's AI-driven, cloud-based, and digital twin solutions, which could drive both revenue expansion and higher-margin product mix.

Read the complete narrative.

Curious about the numbers? The fair value hinges on projections of fast-rising profits and a profit multiple more often seen in growth tech. Want to discover the specific financial bets and the single metric driving this narrative? See what lies behind the headline valuation that could surprise even seasoned investors.

Result: Fair Value of $59.08 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, adoption of disruptive AI tools or intensifying competition in cloud-based engineering software could threaten Bentley’s earnings growth assumptions and long-term profitability.

Find out about the key risks to this Bentley Systems narrative.

Another View: Market Multiples Paint a Different Picture

When looking at Bentley Systems through the lens of price-to-earnings, there is a stark difference compared to earlier optimism. The company trades at 62.9x earnings, which is much richer than both its peers and the broader software sector, and almost double its fair ratio of 35.3x. This suggests the market is baking in a lot of future success, so the current price could carry major downside risk if growth slows.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Bentley Systems Narrative

If you have a different perspective or want to dive into the details yourself, you can put together your own story in under three minutes. Do it your way.

A great starting point for your Bentley Systems research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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