SPS Commerce Stock Analysis, Valuation (NASDAQ:SPSC)

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$71.85 $0.18 (0.25%) SPSC stock closing price May 21, 2018 (Closing)
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SPS Commerce
Updated on : May 21, 2018
previous close
SPSC 71.9 (0%)
S&P 500 2733 (0%)
Closing Price On: May 21, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Business Services
Sector :
Business Services
5 Quarter Revenue
Revenue Growth
2018-Q1
$million
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
22%
Operating Profit
Operating Margin:
4.1%
Sector Average:
8.4%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Cash Flow
Operating cash flow:
$9.4M
Net Income:
$3.3M
PROS      CONS
Recent Growth
Long Term Growth
FCF Margin
Operating Margins
Net Margins
ROIC
ROE
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
SPSC PS :
5.4
Industry PS :
1.6
Sector:   Business Services.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-1.7%
Return on Equity:
-0.8%
Free Cash Flow Margin:
9.3%
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SPS Commerce Stock Analysis

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Watch the robo advisor video of SPS Commerce stock analysis on Amigobulls. This is our analyst opinion covering the buy and sell arguments for SPSC stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

SPS Commerce, Inc. Stock Rating 2/5

We at Amigobulls use various financial measures including profit margins, revenue growth and dividends for SPSC stock analysis. We compare SPS Commerce valuation with its sector peers to gauge relative attractiveness of SPSC stock. SPS Commerce stock rating is our opinion about the business fundamentals of the company.

Should you buy SPSC stock?

  • SPS Commerce sales grew by 13.8% year on year in 2018 Q1.
  • Revenue growth has been tremendous with a compounded annual growth of 22% over the last 5 years.
  • SPS Commerce has a healthy FCF (Free Cash Flow) margin of 9.3%.

Should you sell SPSC stock?

  • SPS Commerce had an unimpressive average operating margin of 4.1% during the Last Twelve Months (LTM).
  • Over the last 12 months, SPS Commerce had an average Net loss of -0.9%.
  • The SPSC stock currently trades at a PE of 146.6, which is expensive, compared to the industry average of 21.9.
  • The company is trading at a price to sales multiple of 5.4, which is higher in comparison to the Business Services industry average of 1.6, making SPSC stock expensive.
  • The company has a negative Return on Invested Capital of -1.7%, which is a red flag.
  • A negative ROE of -0.8% indicates that the company is not able to generate profits with the money shareholders have invested.

Comments on this video and SPS Commerce stock

Investors can use Amigobulls SPS Commerce stock analysis as a tool to arrive at accurate conclusions regarding financial health of the company and its valuation. The fundamentals of a company are vital to identify long-term investment opportunities.

Among the financials of the company, SPS Commerce revenue growth along with the profit or net income give a clear picture of the financial health. Technical analysis comes in handy to check whether the market sentiment is in line with the fundamental picture of the company.