Progress Software (NasdaqGS:PRGS) - Share price, News & Analysis

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

PRGS Stock Overview

Progress Software Corporation develops, deploys, and manages business applications.

Rewards

Trading at 44.5% below our estimate of its fair value

Earnings are forecast to grow 9.17% per year

Earnings have grown 39.3% per year over the past 5 years

Risk Analysis

Has a high level of debt

Significant insider selling over the past 3 months

Progress Software Competitors

Microsoft

NasdaqGS:MSFT

US$1.9t

Amazon.com

NasdaqGS:AMZN

US$1.1t

BAE Systems

LSE:BA.

UK£24.3b

Akamai Technologies

NasdaqGS:AKAM

US$16.0b

Price History & Performance

Summary of all time highs, changes and price drops for Progress Software
Historical stock prices
Current Share Price	US$46.73
52 Week High	US$53.99
52 Week Low	US$41.68
Beta	1.07
1 Month Change	-3.49%
3 Month Change	9.26%
1 Year Change	5.72%
3 Year Change	9.41%
5 Year Change	59.05%
Change since IPO	1,325.66%

Recent News & Updates

May 25

Progress Software (NASDAQ:PRGS) Has Affirmed Its Dividend Of US$0.17

Progress Software Corporation's ( NASDAQ:PRGS ) investors are due to receive a payment of US$0.17 per share on 15th of...

Shareholder Returns

	PRGS	US Software	US Market
7D	-0.8%	-3.3%	-4.0%
1Y	5.7%	-15.5%	-13.2%

Return vs Industry: PRGS exceeded the US Software industry which returned -13.6% over the past year.

Return vs Market: PRGS exceeded the US Market which returned -12.3% over the past year.

Price Volatility

Is PRGS's price volatile compared to industry and market?
PRGS volatility
PRGS Average Weekly Movement	4.5%
Software Industry Average Movement	10.9%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	2.9%

Stable Share Price: PRGS is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: PRGS's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1981	2,103	Yogesh Gupta	https://www.progress.com

Progress Software Corporation develops, deploys, and manages business applications. The company offers OpenEdge, a development software, which builds multi-language applications for secure deployment across various platforms and devices, as well as cloud; developer tools that consists of components for user interface development for Web, mobile, desktop, chat, and AR/VR apps, as well as automated application testing and reporting tools; Sitefinity, a web content management and customer analytics platform; Corticon, a business rules management system that provides applications with decision automation and change process, and decision-related insight capabilities. It also offers DataDirect Connect, which provides data connectivity using industry-standard interfaces to connect applications running on various platforms; MOVEit that offers secure collaboration and automated file transfers of critical business information; Chef, an infrastructure automation platform to build, deploy, manage, and secure applications in multi-cloud and hybrid environments, and on-premises; and WhatsUp Gold, a network monitoring solution.

Progress Software Fundamentals Summary

How do Progress Software's earnings and revenue compare to its market cap?
PRGS fundamental statistics
Market Cap	US$2.05b
Earnings (TTM)	US$79.91m
Revenue (TTM)	US$554.96m

25.6x

P/E Ratio

3.7x

P/S Ratio

Is PRGS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
PRGS income statement (TTM)
Revenue	US$554.96m
Cost of Revenue	US$66.80m
Gross Profit	US$488.16m
Other Expenses	US$408.25m
Earnings	US$79.91m

Last Reported Earnings

Feb 28, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.83
Gross Margin	87.96%
Net Profit Margin	14.40%
Debt/Equity Ratio	168.9%

How did PRGS perform over the long term?

See historical performance and comparison

Dividends

1.5%

Current Dividend Yield

38%

Payout Ratio

Does PRGS pay a reliable dividends?

See PRGS dividend history and benchmarks

When do you need to buy PRGS by to receive an upcoming dividend?
Progress Software dividend dates
Ex Dividend Date	May 31 2022
Dividend Pay Date	Jun 15 2022
Days until Ex dividend	6 days
Days until Dividend pay date	21 days

Does PRGS pay a reliable dividends?

See PRGS dividend history and benchmarks

Valuation

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

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

44.5%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: PRGS ($46.73) is trading below our estimate of fair value ($84.21)

Significantly Below Fair Value: PRGS is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: PRGS is good value based on its Price-To-Earnings Ratio (25.6x) compared to the US Software industry average (41.1x).

PE vs Market: PRGS is poor value based on its Price-To-Earnings Ratio (25.6x) compared to the US market (15.1x).

Price to Earnings Growth Ratio

PEG Ratio: PRGS is poor value based on its PEG Ratio (2.8x)

Price to Book Ratio

PB vs Industry: PRGS is overvalued based on its Price-To-Book Ratio (5.6x) compared to the US Software industry average (3.6x).

Future Growth

How is Progress Software forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

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

9.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: PRGS's forecast earnings growth (9.2% per year) is above the savings rate (1.9%).

Earnings vs Market: PRGS's earnings (9.2% per year) are forecast to grow slower than the US market (12.3% per year).

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

Revenue vs Market: PRGS's revenue (6.4% per year) is forecast to grow slower than the US market (7.8% per year).

High Growth Revenue: PRGS's revenue (6.4% 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 high in 3 years time (27%)

Past Performance

How has Progress Software 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

39.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: PRGS has high quality earnings.

Growing Profit Margin: PRGS's current net profit margins (14.4%) are lower than last year (17.1%).

Past Earnings Growth Analysis

Earnings Trend: PRGS has become profitable over the past 5 years, growing earnings by 39.3% per year.

Accelerating Growth: PRGS's earnings growth over the past year (3%) is below its 5-year average (39.3% per year).

Earnings vs Industry: PRGS earnings growth over the past year (3%) underperformed the Software industry 27.1%.

Return on Equity

High ROE: Whilst PRGS's Return on Equity (21.7%) is high, this metric is skewed due to their high level of debt.

Financial Health

How is Progress Software's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

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

Financial Position Analysis

Short Term Liabilities: PRGS's short term assets ($342.6M) exceed its short term liabilities ($283.7M).

Long Term Liabilities: PRGS's short term assets ($342.6M) do not cover its long term liabilities ($701.1M).

Debt to Equity History and Analysis

Debt Level: PRGS's net debt to equity ratio (121.8%) is considered high.

Reducing Debt: PRGS's debt to equity ratio has increased from 33.7% to 168.9% over the past 5 years.

Debt Coverage: PRGS's debt is well covered by operating cash flow (28.6%).

Interest Coverage: PRGS's interest payments on its debt are well covered by EBIT (6.4x coverage).

Balance Sheet

Dividend

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

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

1.50%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: PRGS's dividend (1.5%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: PRGS's dividend (1.5%) is low compared to the top 25% of dividend payers in the US market (4.05%).

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 6 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (38.4%), PRGS's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (17.6%), PRGS's dividend payments are well covered by cash flows.

Discover strong dividend paying companies

Management

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

2.7yrs

Average management tenure

CEO

Yogesh Gupta (60 yo)

5.58yrs

Tenure

US$6,019,029

Compensation

Mr. Yogesh K. 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...

CEO Compensation Analysis

Compensation vs Market: Yogesh's total compensation ($USD6.02M) is about average for companies of similar size in the US market ($USD5.43M).

Compensation vs Earnings: Yogesh's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: PRGS's management team is considered experienced (2.7 years average tenure).

Board Members

Experienced Board: PRGS's board of directors are considered experienced (4.9 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: PRGS 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	2022/05/24 00:00
End of Day Share Price	2022/05/24 00:00
Earnings	2022/02/28
Annual Earnings	2021/11/30