When Should You Buy SS&C Technologies Holdings, Inc. (NASDAQ:SSNC)?

By
Simply Wall St
Published
April 13, 2022
NasdaqGS:SSNC
Source: Shutterstock

SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$84.24 and falling to the lows of US$70.99. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether SS&C Technologies Holdings' current trading price of US$70.99 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at SS&C Technologies Holdings’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for SS&C Technologies Holdings

Is SS&C Technologies Holdings still cheap?

Good news, investors! SS&C Technologies Holdings is still a bargain right now according to my price multiple model, which compares the company's price-to-earnings ratio to the industry average. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that SS&C Technologies Holdings’s ratio of 22.63x is below its peer average of 36.47x, which indicates the stock is trading at a lower price compared to the Software industry. What’s more interesting is that, SS&C Technologies Holdings’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from SS&C Technologies Holdings?

earnings-and-revenue-growth
NasdaqGS:SSNC Earnings and Revenue Growth April 13th 2022

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by 33% over the next couple of years, the future seems bright for SS&C Technologies Holdings. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? Since SSNC is currently below the industry PE ratio, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current price multiple.

Are you a potential investor? If you’ve been keeping an eye on SSNC for a while, now might be the time to enter the stock. Its buoyant future profit outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy SSNC. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed assessment.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. For example - SS&C Technologies Holdings has 1 warning sign we think you should be aware of.

If you are no longer interested in SS&C Technologies Holdings, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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