Sapiens International (NasdaqGS:SPNS) - Share price, News & Analysis

Q: What is the Fair Price of SPNS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

SPNS ($24.29) is trading below our estimate of [[fair value]] ($35.33)

SPNS fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	4/6
Financial Health	6/6
Dividends	1/6

SPNS Stock Overview

Rewards

Trading at 31.3% below our estimate of its fair value

Earnings are forecast to grow 12.32% per year

Earnings grew by 39.3% over the past year

Risk Analysis

No risks detected for SPNS from our risk checks.

Sapiens International Competitors

InterDigital

NasdaqGS:IDCC

US$1.9b

Cerence

NasdaqGS:CRNC

US$1.0b

Agilysys

NasdaqGS:AGYS

US$1.2b

Magic Software Enterprises

NasdaqGS:MGIC

US$872.4m

Price History & Performance

Summary of all time highs, changes and price drops for Sapiens International
Historical stock prices
Current Share Price	US$24.29
52 Week High	US$38.32
52 Week Low	US$20.00
Beta	1.36
1 Month Change	-7.99%
3 Month Change	-6.25%
1 Year Change	-8.58%
3 Year Change	49.11%
5 Year Change	119.82%
Change since IPO	-56.82%

Recent News & Updates

Jun 22

When Should You Buy Sapiens International Corporation N.V. (NASDAQ:SPNS)?

While Sapiens International Corporation N.V. ( NASDAQ:SPNS ) might not be the most widely known stock at the moment, it...

Jun 09

Sapiens International (NASDAQ:SPNS) Might Have The Makings Of A Multi-Bagger

If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for...

Shareholder Returns

	SPNS	US Software	US Market
7D	-2.6%	-4.7%	-2.5%
1Y	-8.6%	-23.6%	-21.2%

Return vs Industry: SPNS exceeded the US Software industry which returned -23.7% over the past year.

Return vs Market: SPNS exceeded the US Market which returned -21.2% over the past year.

Price Volatility

Is SPNS's price volatile compared to industry and market?
SPNS volatility
SPNS Average Weekly Movement	7.9%
Software Industry Average Movement	11.0%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	3.3%

Stable Share Price: SPNS is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: SPNS's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1982	4,044	Ron Al-Dor	https://www.sapiens.com

Sapiens International Corporation N.V. provides software solutions for the insurance and financial services industries in North America, the European Union, the United Kingdom, Israel, and internationally. The company offers Sapiens CoreSuite and Sapiens IDITSuite for personal, commercial, and specialty lines; and Sapiens CoreSuite, Sapiens UnderwritingPro, Sapiens ApplicationPro, Sapiens IllustrationPro, and Sapiens ConsolidationMaster for life, pension, and annuities. It also provides Sapiens DigitalSuite for customers, agents, brokers, risk managers, customer groups and third-party service providers; Sapiens ReinsuranceMaster and Sapiens ReinsurancePro reinsurance solutions; and Sapiens Platform, Sapiens CoreSuite, Sapiens PolicyPro, and Sapiens ClaimsPro, as well as Sapiens PolicyGo, and Sapiens ClaimsGo for workers’ compensation.

Sapiens International Fundamentals Summary

How do Sapiens International's earnings and revenue compare to its market cap?
SPNS fundamental statistics
Market Cap	US$1.34b
Earnings (TTM)	US$51.26m
Revenue (TTM)	US$469.14m

26.1x

P/E Ratio

2.9x

P/S Ratio

Is SPNS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SPNS income statement (TTM)
Revenue	US$469.14m
Cost of Revenue	US$276.13m
Gross Profit	US$193.01m
Other Expenses	US$141.74m
Earnings	US$51.26m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.93
Gross Margin	41.14%
Net Profit Margin	10.93%
Debt/Equity Ratio	18.9%

How did SPNS perform over the long term?

See historical performance and comparison

Dividends

1.5%

Current Dividend Yield

0%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is SPNS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SPNS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SPNS. This is calculated by dividing SPNS's market cap by their current preferred multiple.
What is SPNS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$1.34b

SPNS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.7x
Enterprise Value/EBITDA	15.3x
PEG Ratio	2.1x

Price to Earnings Ratio vs Peers

How does SPNS's PE Ratio compare to its peers?

SPNS PE Ratio vs Peers

The above table shows the PE ratio for SPNS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	87.9x
IDCC InterDigital	27.6x	24.3%	US$1.9b
CRNC Cerence	31.4x	26.5%	US$1.0b
AGYS Agilysys	260.9x	23.9%	US$1.2b
MGIC Magic Software Enterprises	31.9x	31.4%	US$872.4m
SPNS Sapiens International	26.1x	12.3%	US$1.3b

Forward PE

Price-To-Earnings vs Peers: SPNS is good value based on its Price-To-Earnings Ratio (26.1x) compared to the peer average (87.9x).

Price to Earnings Ratio vs Industry

How does SPNS's PE Ratio compare vs other companies in the US Software Industry?

Price-To-Earnings vs Industry: SPNS is good value based on its Price-To-Earnings Ratio (26.1x) compared to the US Software industry average (38.2x)

Price to Earnings Ratio vs Fair Ratio

What is SPNS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SPNS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	26.1x
Fair PE Ratio	28.3x

Price-To-Earnings vs Fair Ratio: SPNS is good value based on its Price-To-Earnings Ratio (26.1x) compared to the estimated Fair Price-To-Earnings Ratio (28.3x).

Share Price vs Fair Value

What is the Fair Price of SPNS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SPNS ($24.29) is trading below our estimate of fair value ($35.33)

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

Price to Earnings Growth Ratio

PEG Ratio: SPNS is poor value based on its PEG Ratio (2.1x)

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Future Growth

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

Future Growth Score

1/6

Future Growth Score 1/6

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

12.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SPNS's forecast earnings growth (12.3% per year) is above the savings rate (1.9%).

Earnings vs Market: SPNS's earnings (12.3% per year) are forecast to grow slower than the US market (13.6% per year).

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

Revenue vs Market: SPNS's revenue (8.1% per year) is forecast to grow slower than the US market (8.2% per year).

High Growth Revenue: SPNS's revenue (8.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SPNS's Return on Equity is forecast to be low in 3 years time (13.4%).

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Past Performance

How has Sapiens International performed over the past 5 years?

Past Performance Score

4/6

Past Performance Score 4/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

41.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SPNS has high quality earnings.

Growing Profit Margin: SPNS's current net profit margins (10.9%) are higher than last year (9.2%).

Past Earnings Growth Analysis

Earnings Trend: SPNS's earnings have grown significantly by 41.1% per year over the past 5 years.

Accelerating Growth: SPNS's earnings growth over the past year (39.3%) is below its 5-year average (41.1% per year).

Earnings vs Industry: SPNS earnings growth over the past year (39.3%) exceeded the Software industry 26.8%.

Return on Equity

High ROE: SPNS's Return on Equity (12.3%) is considered low.

Discover strong past performing companies

Financial Health

How is Sapiens International's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

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

Financial Position Analysis

Short Term Liabilities: SPNS's short term assets ($303.1M) exceed its short term liabilities ($158.1M).

Long Term Liabilities: SPNS's short term assets ($303.1M) exceed its long term liabilities ($132.0M).

Debt to Equity History and Analysis

Debt Level: SPNS has more cash than its total debt.

Reducing Debt: SPNS's debt to equity ratio has reduced from 20% to 18.9% over the past 5 years.

Debt Coverage: SPNS's debt is well covered by operating cash flow (110.3%).

Interest Coverage: SPNS's interest payments on its debt are well covered by EBIT (25.8x coverage).

Balance Sheet

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Dividend

What is Sapiens International current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

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

1.52%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: SPNS's dividend (1.52%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.6%).

High Dividend: SPNS's dividend (1.52%) is low compared to the top 25% of dividend payers in the US market (4.25%).

Stability and Growth of Payments

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

Growing Dividend: SPNS's dividend payments have increased, but the company has only paid a dividend for 2 years.

Earnings Payout to Shareholders

Earnings Coverage: Unable to calculate sustainability of dividends as SPNS has not reported any payouts.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (27%), SPNS's dividend payments are well covered by cash flows.

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Management

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

2.0yrs

Average management tenure

CEO

Ron Al-Dor (61 yo)

16.67yrs

Tenure

Mr. Roni Al-Dor, also known as Ron, has been the Chief Executive Officer and President of Sapiens International Corporation N.V. since November 2005. Mr. Al-Dor serves as President, Chief Executive Officer...

Leadership Team

Experienced Management: SPNS's management team is considered experienced (2 years average tenure).

Board Members

Experienced Board: SPNS's board of directors are seasoned and experienced ( 16.7 years average tenure).

Ownership

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

Insider Trading Volume

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

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/07/03 00:00
End of Day Share Price	2022/07/01 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31