Aspen Technology Inc

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AZPN : NASDAQ : Technology
$61.49 | %
Today's Range: 61.34 - 62.09
Avg. Daily Volume: 514600.0
04/28/17 - 4:00 PM ET

Financial Analysis


ASPEN TECHNOLOGY INC's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. ASPEN TECHNOLOGY INC has very weak liquidity. Currently, the Quick Ratio is 0.40 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 768.97% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)119.93119.15
EBITDA ($mil)57.5858.8
EBIT ($mil)56.0757.33
Net Income ($mil)37.0136.68


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)139.97200.57
Total Assets ($mil)267.36276.39
Total Debt ($mil)140.00.0
Equity ($mil)-192.88-22.2


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin91.691.26
EBITDA Margin48.049.34
Operating Margin46.7548.11
Sales Turnover1.771.68
Return on Assets51.847.91
Return on Equity0.00.0
Debt Q2 FY17 Q2 FY16
Current Ratio0.430.98
Debt/Capital-2.650.0
Interest Expense0.890.01
Interest Coverage62.784409.77


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)76.2583.39
Div / share0.00.0
EPS0.480.44
Book value / share-2.53-0.27
Institutional Own % n/a n/a
Avg Daily Volume544173.0612974.0

Valuation


SELL. The current P/E ratio indicates a significant discount compared to an average of 57.32 for the Software industry and a significant premium compared to the S&P 500 average of 24.92. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, ASPEN TECHNOLOGY INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AZPN 34.98 Peers 57.32   AZPN 28.17 Peers 22.45

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

AZPN is trading at a significant discount to its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AZPN is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AZPN 31.36 Peers 41.62   AZPN 3.92 Peers 0.84

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

AZPN is trading at a discount to its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AZPN trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AZPN NM Peers 8.71   AZPN 10.89 Peers 44.45

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AZPN's P/B is negative making this valuation measure meaningless.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, AZPN is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AZPN 9.76 Peers 6.41   AZPN 1.70 Peers 7.81

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AZPN is trading at a significant premium to its industry.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

AZPN significantly trails its peers on the basis of sales growth

 

 

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