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PAR

PAR Technology NYSE:PAR Stock Report

Last Price

US$40.97

Market Cap

US$1.1b

7D

1.9%

1Y

-27.6%

Updated

16 Aug, 2022

Data

Company Financials +
PAR fundamental analysis
Snowflake Score
Valuation1/6
Future Growth1/6
Past Performance0/6
Financial Health3/6
Dividends0/6

PAR Stock Overview

PAR Technology Corporation, together with its subsidiaries, provides technology solutions to the restaurant and retail industries worldwide.

PAR Technology Corporation Competitors

Price History & Performance

Summary of all time highs, changes and price drops for PAR Technology
Historical stock prices
Current Share PriceUS$40.97
52 Week HighUS$73.45
52 Week LowUS$28.87
Beta1.81
1 Month Change10.46%
3 Month Change20.78%
1 Year Change-27.59%
3 Year Change85.13%
5 Year Change294.70%
Change since IPO1,099.12%

Recent News & Updates

Aug 08

PAR Technology Q2 2022 Earnings Preview

PAR Technology (NYSE:PAR) is scheduled to announce Q2 earnings results on Tuesday, August 9th, before market open. The consensus EPS Estimate is -$0.36 (flat Y/Y) and the consensus Revenue Estimate is $79.57M (+15.4% Y/Y). Over the last 2 years, PAR has beaten EPS estimates 63% of the time and has beaten revenue estimates 88% of the time. Over the last 3 months, EPS estimates have seen 2 upward revisions and 2 downward. Revenue estimates have seen 6 upward revisions and 0 downward.

Jul 08
Is PAR Technology (NYSE:PAR) Using Too Much Debt?

Is PAR Technology (NYSE:PAR) Using Too Much Debt?

The external fund manager backed by Berkshire Hathaway's Charlie Munger, Li Lu, makes no bones about it when he says...

Jul 05

PAR Technology: Still Expensive

PAR Technology is now down over 55% after a spectacular 800% run from March 2020 to February 2021. The US-based company is seeing success from its transition from a service company to a SaaS company with ARR up 400% in less than three years. It has a huge TAM as restaurants are now shifting from legacy software platforms to modern cloud-based software platforms. The company is showing strong growth, but profitability and valuation remain a concern. I rate the company as a hold. Investment Thesis PAR Technology (PAR) was one of the winning companies in the pandemic. Its stock rose from around $11 back in March 2020 to over $88 in February 2021, representing an 800% increase within a year. However, the company got caught in the high-growth tech sector sell-off, and the share price has dropped by over 55% from its all-time high, now trading at $38.08. PAR has been around for a long time. The US-based company was founded in 1968 and went public in 1982. It started off as a tech contractor and provide POS (point of sale) systems to different companies. However, it received little love as the business was very underwhelming, and the share price remained flat for almost 40 years. Current CEO Savneet Singh stepped in during 2019 and decided to turn the ship around by transforming PAR Technology from a service company to a SaaS (subscription as a service) company. This resulted in a huge success, with ARR (annual recurring revenue) increasing by over 400% in less than three years. Data by YCharts Savneet Singh, CEO, on the company's vision: We continue to work to advance the enterprise restaurant industry vision of autonomous restaurants with our focus on creating a single cloud-based platform that is designed to enable staff and tech enabled restaurant operations. Unified Commerce connects all the guest facing channels - website, app, in-stores, third party deliveries - with one common technology platform that is built on the Open Web standards. This is an evolution in the industry from multichannel and omnichannel platforms which still require brands to do the heavy duty integration, often at their own peril. The restaurant software and POS market are also huge as restaurants are now changing their operating system in order to improve efficiency. However, even after the large drop in share price, the company is still trading at a premium compared to peers that are growing at similar levels. Despite the strong top-line growth, profitability remains a big issue. Therefore, I believe PAR Technology is a hold for now and will upgrade it to a buy when profitability improves and valuation becomes more appealing. PAR Technology Market Opportunity PAR Technology is operating in the restaurant software and POS space, which has a huge TAM (total addressable market). This is due to the shift from legacy operating platforms to modern cloud-based operating platforms. Restaurants are now seeking ways to improve efficiency, and the modern operating system allows them to have a unified platform that consolidates all data. The platform can also address multiple needs like purchases, analytics, loyalty, menu management, and more. It is also able to offer more capabilities like omnichannel ordering and personalized engagement. According to PAR, currently, only around 10%-20% of enterprises have migrated to a pure cloud operating platform. I believe the shift will continue to accelerate as restaurants are looking to move to a more efficient and flexible platform. The restaurant industry is one of the largest industries in the world. According to Toast, the annual sales for the US restaurant industry alone are $800 billion, representing 3% of GDP. The TAM for the US is estimated to be $50 billion, while TAM for the rest of the world is estimated to be $110+ billion. The POS market is also growing quickly. According to Markets and Markets, the market size of POS is $15.8 billion in 2020 and is estimated to grow to $34.4 billion by 2026, representing a CAGR (compounded annual growth rate) of 13.9%. This provides a huge market for PAR to expand into moving forward. Savneet Singh, CEO, on market trends: "We are at an exciting time in our industry, as restaurants large and small transform and modernize to become software-driven, digital enterprises. Our Q1 results reflect the power of our platform and integrating Punchh with Brink and Data Central and we closed several large brands who chose multiple PAR solutions in the quarter. These recent customer wins demonstrate the accelerating demand for Unified Commerce where restaurants require simpler solutions, fewer integrations and more natively unified solutions." PAR Technology Competitors With the restaurant software and POS space being such a huge market, competition is quite fierce. PAR Technology has multiple competitors which include Toast (TOST), Lightspeed (LSPD), Block (SQ), and Shopify (SHOP). Block and Shopify provide POS systems mainly for SMBs, while Lightspeed POS targets the medium-high end niche. Toast is the main competitor which focuses solely on restaurants. Both companies have a strong and comprehensive products, but they operate quite differently. Toast is targeting restaurants of all sizes and offers a free plan to attract customers on board. It then upsells different products like marketing and inventory management to customers to increase its ARPU (average revenue per user). While PAR Technology is differentiating itself by mainly focusing on the enterprise restaurant market. I believe this is a very smart move as it allows them to charge a higher-priced plan and generate more revenue from the start. It also makes them immune to competition from Shopify and Block, as they focus mainly on SMBs. Enterprise restaurants also have a higher spending power compared to small and medium-sized restaurants, which give PAR Technology a higher ARPU. PAR Technology Financials and Valuation PAR Technology announced its Q1 earnings in May and its growth rate remains very impressive. The company reported revenue of $80.3 million, up 47.4% YoY (year over year) from $54.5 million. Gross profit was $20.6 million compared to $10.2 million, representing a 102% increase YoY. This is largely driven by the explosive growth in ARR. ARR at the end of Q1 was $94.4 million, a 172% increase from $34.6 million a year ago. Punchh, its loyalty division, delivered a YoY ARR growth of 39% while Brink, its POS division, delivered a YoY ARR growth of 35%. Active sites for Punchh and Brink are 58,801 restaurants and 16,945 restaurants, respectively.

Shareholder Returns

PARUS ElectronicUS Market
7D1.9%5.4%4.5%
1Y-27.6%-10.6%-8.9%

Return vs Industry: PAR underperformed the US Electronic industry which returned -12% over the past year.

Return vs Market: PAR underperformed the US Market which returned -9.6% over the past year.

Price Volatility

Is PAR's price volatile compared to industry and market?
PAR volatility
PAR Average Weekly Movement7.8%
Electronic Industry Average Movement7.5%
Market Average Movement7.6%
10% most volatile stocks in US Market16.8%
10% least volatile stocks in US Market3.1%

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

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

About the Company

FoundedEmployeesCEOWebsite
19681,509Savneet Singhhttps://www.partech.com

PAR Technology Corporation, together with its subsidiaries, provides technology solutions to the restaurant and retail industries worldwide. The company operates in two segments, Restaurant/Retail and Government. The Restaurant/Retail segment offers point-of-sale (POS) technology solutions, including Brink POS, an open cloud solution that integrates with third party products and in-house systems; Punchh, an enterprise-grade customer loyalty and engagement solution for restaurant and convenience store brands; Data Central, a cloud software solution for back-office applications; PAR Payment Services, a merchant services offering; POS integrated solutions for wireless headsets for drive-thru order-taking; and the PAR Infinity, PAR Phase, PAR Helix, and the EverServ 8000 series platform.

PAR Technology Corporation Fundamentals Summary

How do PAR Technology's earnings and revenue compare to its market cap?
PAR fundamental statistics
Market CapUS$1.12b
Earnings (TTM)-US$92.07m
Revenue (TTM)US$324.84m

3.4x

P/S Ratio

-12.1x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
PAR income statement (TTM)
RevenueUS$324.84m
Cost of RevenueUS$246.29m
Gross ProfitUS$78.55m
Other ExpensesUS$170.62m
Earnings-US$92.07m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)-3.38
Gross Margin24.18%
Net Profit Margin-28.34%
Debt/Equity Ratio98.2%

How did PAR perform over the long term?

See historical performance and comparison