Bentley Systems (BSY): Valuation Insights Following Dividend, Buyback Expansion, and Infrastructure AI Developments

Bentley Systems (BSY) made headlines after announcing a $0.07 dividend for the fourth quarter, expanding its share repurchase plan, and reporting healthy double-digit revenue growth. Management also highlighted new AI-powered infrastructure solutions, which are fueling optimism about future performance.

See our latest analysis for Bentley Systems.

Bentley Systems has seen its share price retreat about 18% over the past month and slide more than 21% over the last quarter, reflecting a shift in market sentiment despite robust revenue growth and shareholder-friendly moves like the dividend and buyback expansion. While the 1-year total shareholder return is down 15%, the longer-term picture still shows meaningful gains, with total returns of 11% over three years and 24% over five years. Momentum has clearly faded lately, but the company’s renewed focus on AI and capital returns could help restore investor confidence going forward.

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With the stock trading nearly 40% below the average analyst price target, investors are left to consider whether Bentley Systems is trading at a true bargain or if the market is rightly factoring in every aspect of future growth.

Most Popular Narrative: 28.1% Undervalued

The most widely followed narrative places Bentley Systems' fair value at $58.21, which is well above the last close of $41.85. The narrative relies on technology transformation and sector tailwinds as key drivers for this valuation premium.

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 and supports durable double-digit ARR and revenue growth. Large-scale productivity challenges, such as the shortage of skilled engineers, are leading 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 a higher-margin product mix.

Read the complete narrative.

Want to unpack the financial leap behind this bullish valuation? The real story lies in the narrative’s ambitious earnings and profit margin assumptions. Can Bentley’s market position and digital capabilities justify a price typically associated with top-tier tech disruptors? Get the details shaping this fair value projection and see what numbers the analysts are really relying on.

Result: Fair Value of $58.21 (UNDERVALUED)

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

However, rising competition from cloud-native rivals and uncertainty in emerging markets could challenge the sustainability of Bentley’s positive outlook.

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

Another View: Multiples Point to a Premium

Looking at Bentley Systems through the lens of price-to-earnings, the shares are trading at 48.8 times earnings, which is a noticeable premium compared to both the US Software industry average of 32x and the peer average of 45.7x. The fair ratio is estimated at 32.5x, suggesting investors are paying up for perceived growth. Does the market see something the models do not, or is risk creeping in?

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

Build Your Own Bentley Systems Narrative

If you see things differently or want to draw your own conclusions from the numbers, why not craft your own take on Bentley Systems in under three minutes—Do it your way.

A great starting point for your Bentley Systems research is our analysis highlighting 2 key rewards and 2 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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