The Ultimate Software Group Inc

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ULTI : NASDAQ : Technology
$211.32 | %
Today's Range: 209.33 - 213.16
Avg. Daily Volume: 230,500
08/26/16 - 4:00 PM ET

Financial Analysis


ULTIMATE SOFTWARE GROUP INC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased. ULTIMATE SOFTWARE GROUP INC has very weak liquidity. Currently, the Quick Ratio is 0.21 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.

During the same period, stockholders' equity ("net worth") has increased by 23.91% 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 FY16 Q2 FY15
Net Sales ($mil)186.54147.23
EBITDA ($mil)14.9412.98
EBIT ($mil)8.467.63
Net Income ($mil)1.683.66


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)97.99110.82
Total Assets ($mil)1518.03868.23
Total Debt ($mil)9.668.93
Equity ($mil)364.45294.12


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin64.5864.05
EBITDA Margin8.08.81
Operating Margin4.545.18
Sales Turnover0.460.64
Return on Assets1.254.52
Return on Equity5.2113.36
Debt Q2 FY16 Q2 FY15
Current Ratio1.081.17
Debt/Capital0.030.03
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)28.9328.56
Div / share0.00.0
EPS0.060.12
Book value / share12.610.3
Institutional Own % n/a n/a
Avg Daily Volume229513.0244565.0

Valuation


BUY. ULTIMATE SOFTWARE GROUP INC's P/E ratio indicates a significant premium compared to an average of 59.58 for the Software industry and a significant premium compared to the S&P 500 average of 25.13. For additional comparison, its price-to-book ratio of 16.81 indicates a significant premium versus the S&P 500 average of 2.82 and a significant premium versus the industry average of 7.52. 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, ULTIMATE SOFTWARE GROUP INC proves to trade at a premium 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
ULTI 330.89 Peers 59.58   ULTI 51.20 Peers 23.28

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

ULTI 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.

ULTI 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
ULTI 51.90 Peers 33.35   ULTI 0.99 Peers 0.85

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ULTI is trading at a significant premium 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.

ULTI trades at a premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ULTI 16.81 Peers 7.52   ULTI -51.88 Peers 27.93

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

ULTI is trading at a significant premium to its peers.

 

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

However, ULTI 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
ULTI 8.76 Peers 5.94   ULTI 26.08 Peers 5.44

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.

ULTI is trading at a significant premium to its industry.

 

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

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

 

 

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