NasdaqGS:PRGS

Stock Analysis Report

Executive Summary

Progress Software Corporation develops business applications worldwide.

Snowflake

Fundamentals

Fair value with mediocre balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: PRGS has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.4%

PRGS

2.3%

US Software

0.9%

US Market


1 Year Return

27.5%

PRGS

37.2%

US Software

15.5%

US Market

Return vs Industry: PRGS underperformed the US Software industry which returned 37.2% over the past year.

Return vs Market: PRGS exceeded the US Market which returned 15.5% over the past year.


Shareholder returns

PRGSIndustryMarket
7 Day0.4%2.3%0.9%
30 Day5.6%10.1%4.7%
90 Day7.4%5.0%6.6%
1 Year29.6%27.5%39.1%37.2%18.1%15.5%
3 Year45.7%39.0%125.3%116.8%48.0%38.5%
5 Year69.1%61.4%174.9%155.5%62.1%44.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

7.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PRGS ($41.56) is trading below our estimate of fair value ($44.91)

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


Price To Earnings Ratio

PE vs Industry: PRGS is good value based on its PE Ratio (34.8x) compared to the Software industry average (45x).

PE vs Market: PRGS is poor value based on its PE Ratio (34.8x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: PRGS is good value based on its PB Ratio (5.6x) compared to the US Software industry average (5.8x).


Next Steps

Future Growth

How is Progress Software forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

11.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PRGS's forecast earnings growth (11.5% per year) is above the savings rate (2.7%).

Earnings vs Market: PRGS's earnings (11.5% per year) are forecast to grow slower than the US market (14.3% per year).

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

Revenue vs Market: PRGS's revenue (1.9% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: PRGS's revenue (1.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PRGS's Return on Equity is forecast to be low in 3 years time (15.8%).


Next Steps

Past Performance

How has Progress Software performed over the past 5 years?

16.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PRGS has high quality earnings.

Growing Profit Margin: PRGS's current net profit margins (13%) are lower than last year (14.5%).


Past Earnings Growth Analysis

Earnings Trend: PRGS's earnings have grown by 16.2% per year over the past 5 years.

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

Earnings vs Industry: PRGS had negative earnings growth (-6.7%) over the past year, making it difficult to compare to the Software industry average (25.8%).


Return on Equity

High ROE: PRGS's Return on Equity (16.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Progress Software's financial position?


Financial Position Analysis

Short Term Liabilities: PRGS's short term assets ($236.3M) exceeds its short term liabilities ($215.3M)

Long Term Liabilities: PRGS's short term assets ($236.3M) do not cover its long term liabilities (311.6M)


Debt to Equity History and Analysis

Debt Level: PRGS's debt to equity ratio (89%) is considered high.

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

Debt Coverage: PRGS's debt is well covered by operating cash flow (39.2%).

Interest Coverage: PRGS's interest payments on its debt are well covered by EBIT (11.9x coverage).


Balance Sheet

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

Debt Coverage by Assets: PRGS's debt is not covered by short term assets (assets are 0.8x debt).


Next Steps

Dividend

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

1.59%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Progress Software before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.6%marketbottom25%1.4%markettop25%3.7%industryaverage1.4%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: PRGS's dividend (1.59%) is higher than the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: PRGS's dividend (1.59%) is low compared to the top 25% of dividend payers in the US market (3.65%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, PRGS has been paying a dividend for less than 10 years.

Growing Dividend: PRGS's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (51.9%), PRGS's dividend payments are 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

What is the CEO of Progress Software's salary, the management and board of directors tenure and is there insider trading?

2.8yrs

Average management tenure


CEO

Yogesh Gupta (58yo)

3.1yrs

Tenure

US$4,810,311

Compensation

Mr. Yogesh Gupta has been the Chief Executive Officer of Progress Software Corporation since October 10, 2016 and as its President since October 2016. Prior to that time, Mr. Gupta served as an advisor to  ...


CEO Compensation Analysis

Compensation vs Market: Yogesh's total compensation ($USD4.81M) is about average for companies of similar size in the US market ($USD3.92M).

Compensation vs Earnings: Yogesh's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

2.8yrs

Average Tenure

56yo

Average Age

Experienced Management: PRGS's management team is considered experienced (2.8 years average tenure).


Board Age and Tenure

2.4yrs

Average Tenure

60yo

Average Age

Experienced Board: PRGS's board of directors are not considered experienced ( 2.4 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$591,45529 Apr 19
Dimitre Taslakov
EntityIndividual
Shares12,999
Max PriceUS$45.50
SellUS$42,86325 Apr 19
Anthony Murphy
EntityIndividual
Role
Chief Information Officer
Chief Information Officer & Chief Information Security Officer
Shares932
Max PriceUS$45.99
SellUS$353,88312 Apr 19
Charles Kane
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares7,764
Max PriceUS$45.58
SellUS$2,025,26805 Apr 19
John Egan
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman of the Board
Shares45,000
Max PriceUS$45.30

Ownership Breakdown

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


Management Team

  • Yogesh Gupta (58yo)

    CEO, President & Director

    • Tenure: 3.1yrs
    • Compensation: US$4.81m
  • Gary Quinn (58yo)

    Senior Vice President of Core Field Organization

    • Tenure: 2.3yrs
    • Compensation: US$1.45m
  • Stephen Faberman (49yo)

    Chief Legal Officer & Secretary

    • Tenure: 3.9yrs
    • Compensation: US$1.31m
  • Paul Jalbert (62yo)

    Chief Financial Officer

    • Tenure: 2.7yrs
    • Compensation: US$1.93m
  • Tony Murphy (48yo)

    Chief Information Officer & Chief Information Security Officer

    • Tenure: 2.4yrs
  • Katie Kulikoski

    Chief People Officer

    • Tenure: 0yrs
  • Kim King

    Vice President of Global Partners and Channels

    • Tenure: 7.1yrs
  • John Ainsworth (54yo)

    Senior Vice President of Core Products

    • Tenure: 2.8yrs
    • Compensation: US$1.38m
  • Brian Flanagan

    Directory of Treasury & Investor Relations

    • Tenure: 0yrs
  • Jennifer Ortiz

    Vice President of Corporate Marketing

    • Tenure: 0.08yrs

Board Members

  • Jack Egan (61yo)

    Non-Executive Chairman of the Board

    • Tenure: 6.9yrs
    • Compensation: US$307.84k
  • Paul Dacier (61yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$397.86k
  • David Krall (59yo)

    Independent Director

    • Tenure: 11.8yrs
    • Compensation: US$272.84k
  • Chuck Kane (62yo)

    Independent Director

    • Tenure: 13yrs
    • Compensation: US$272.84k
  • Yogesh Gupta (58yo)

    CEO, President & Director

    • Tenure: 3.1yrs
    • Compensation: US$4.81m
  • Michael Mark (73yo)

    Non-Voting Director Emeritus and Advisor to President & CEO

    • Tenure: 1.5yrs
    • Compensation: US$280.01k
  • Vivian Vitale (65yo)

    Director

    • Tenure: 0.08yrs
  • Angela Tucci (52yo)

    Independent Director

    • Tenure: 1.8yrs
    • Compensation: US$552.22k
  • Rainer Gawlick (51yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: US$420.36k
  • Sam King (45yo)

    Independent Director

    • Tenure: 1.8yrs
    • Compensation: US$557.22k

Company Information

Progress Software Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Progress Software Corporation
  • Ticker: PRGS
  • Exchange: NasdaqGS
  • Founded: 1981
  • Industry: Systems Software
  • Sector: Software
  • Market Cap: US$1.861b
  • Shares outstanding: 44.79m
  • Website: https://www.progress.com

Number of Employees


Location

  • Progress Software Corporation
  • 14 Oak Park Drive
  • Bedford
  • Massachusetts
  • 1730
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PRGSNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 1991
PGRDB (Deutsche Boerse AG)YesCommon StockDEEURJul 1991

Biography

Progress Software Corporation develops business applications worldwide. The company operates in three segments: OpenEdge, Data Connectivity and Integration, and Application Development and Deployment. The  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/18 23:43
End of Day Share Price2019/11/18 00:00
Earnings2019/08/31
Annual Earnings2018/11/30


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.