EPAM Systems Inc

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EPAM : NYSE : Technology
$73.12 | %
Today's Range: 0.0 - 0.0
Avg. Daily Volume: 422600.0
02/23/17 - 4:02 PM ET

Financial Analysis


EPAM SYSTEMS INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. EPAM SYSTEMS INC is extremely liquid. Currently, the Quick Ratio is 4.91 which clearly shows the ability to cover any short-term cash needs. EPAM managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 30.93% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)298.29236.05
EBITDA ($mil)40.0132.57
EBIT ($mil)34.0928.17
Net Income ($mil)26.1722.87


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)330.63244.44
Total Assets ($mil)909.2703.73
Total Debt ($mil)33.0615.0
Equity ($mil)750.11572.87


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin36.0437.1
EBITDA Margin13.4113.79
Operating Margin11.4311.94
Sales Turnover1.221.22
Return on Assets11.2310.69
Return on Equity13.6113.13
Debt Q3 FY16 Q3 FY15
Current Ratio5.194.45
Debt/Capital0.040.03
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)51.0249.85
Div / share0.00.0
EPS0.490.44
Book value / share14.711.49
Institutional Own % n/a n/a
Avg Daily Volume420986.0366520.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 28.19 for the IT Services industry and a significant premium compared to the S&P 500 average of 26.35. To use another comparison, its price-to-book ratio of 4.81 indicates a significant premium versus the S&P 500 average of 2.94 and a significant discount versus the industry average of 9.67. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
EPAM 36.82 Peers 28.19   EPAM 29.37 Peers 19.60

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

EPAM is trading at a significant premium 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.

EPAM 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
EPAM 17.37 Peers 21.10   EPAM 0.33 Peers 3.03

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

EPAM is trading at a valuation on par with its peers.

 

Discount. 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.

EPAM trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
EPAM 4.81 Peers 9.67   EPAM 30.61 Peers 5.77

Discount. 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.

EPAM is trading at a significant discount to its peers.

 

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

EPAM is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
EPAM 3.26 Peers 5.36   EPAM 29.29 Peers 13.00

Discount. 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.

EPAM is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

EPAM has a sales growth rate that significantly exceeds its peers.

 

 

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