Progress Software (PRGS): Valuation Check After AWS AI Launch and ShareFile-Driven Recurring Revenue Boost

Progress Software (PRGS) just put its no code Agentic RAG platform on AWS Marketplace and paired that with a smooth ShareFile integration, a combo that quietly reshapes its AI story and recurring revenue profile.

See our latest analysis for Progress Software.

Even with this expansion of its AI and SaaS footprint, Progress Software’s latest share price around $44.33 comes after a year-to-date share price return of negative 31.49 percent and a one year total shareholder return of negative 35.99 percent. Recent gains suggest tentative momentum, but not yet a full shift in sentiment.

If this kind of under the radar AI execution interests you, it could be worth scanning other names using our tech focused screen for high growth tech and AI stocks and seeing what else stands out.

With shares still trading at over a 50 percent discount to analyst targets despite improving AI driven margins and recurring revenue, is Progress quietly undervalued here, or is the market already discounting its next leg of growth?

Most Popular Narrative: 36.7% Undervalued

With Progress Software last closing at $44.33 against a narrative fair value of $70, the gap implies investors are still heavily discounting its SaaS shift and AI plans.

The successful integration of ShareFile has significantly boosted ARR, revenue, and expense savings, which could indicate strong future revenue growth and improved net margins due to operational efficiencies. The strategic focus on SaaS acquisitions, exemplified by ShareFile, allows Progress Software to potentially increase recurring revenue, enhancing revenue predictability and stability over time.

Read the complete narrative.

Want to see what kind of earnings ramp and margin reset would justify that higher value, even after a steep discount rate haircut? The narrative leans on a specific blend of modest top line growth, sharp profitability gains, and a future earnings multiple more typical of higher growth software names. Curious how those moving parts fit together to reach that target while still baking in risk?

Result: Fair Value of $70 (UNDERVALUED)

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

However, the aggressive SaaS M&A push and execution risks around ShareFile integration could still compress margins and derail the earnings reset implied in the narrative.

Find out about the key risks to this Progress Software narrative.

Another View, Richer Multiples Signal Caution

While the narrative fair value frames Progress Software as 36.7 percent undervalued, its 39.2 times earnings multiple is meaningfully higher than both the peer average at 29.2 times and the US software sector at 32 times, even if the fair ratio of 46.8 times hints at upside if sentiment turns.

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

Build Your Own Progress Software Narrative

If you see the story differently or want to stress test the assumptions yourself, you can build a fresh narrative in just a few minutes: Do it your way.

A great starting point for your Progress Software research is our analysis highlighting 2 key rewards 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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