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Pegasystems Inc PEGA Stock Quote

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Morningstar‘s Stock Analysis PEGA

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Is it the right time to buy or sell?

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Pegasystems' Earnings Still Marred by Currency and Model Transition; FVE Down to $55

Dan Romanoff, CPA Senior Equity Analyst

Analyst Note

| Dan Romanoff, CPA |

Narrow-moat Pegasystems reported third-quarter results that fell short of our revenue and profitability expectations as it continues to face material currency headwinds and the rapid adoption of Pega Cloud. When considering these factors, we remain confident in our view that Pegasystems’ long-term growth is rooted in the cloud transition and are encouraged by its cloud metrics in the quarter. Bears would point to poor top- and bottom-line performance and macroeconomic factors out of Pegasystems’ control. Bulls would focus on longer-term factors such as sacrificing revenue now due to increased Pega Cloud adoption for growth and stable revenue once the model transition is complete. We have lowered our growth and profitability estimates for the next couple of years, which drives our fair value estimate down to $55 per share from $74. While we see upside to the stock, we would prefer to invest in cleaner stories in this environment.

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Key Statistics PEGA

Company Profile PEGA

Business Description

Founded in 1983, Pegasystems provides a suite of solutions for customer engagement and business process automation. The company’s key offering is the Pega Infinity platform, which combines business process automation with customer engagement applications.

One Main Street
Cambridge, MA, 02142
T +1 617 374-9600
Industry Software - Application
Most Recent Earnings Sep 30, 2022
Fiscal Year End Dec 31, 2022
Employees 6,133