A Business at a Glance
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PEGASYSTEMS INC
PEGA
$5.0B
Mkt Cap
$26.82
+3.11%
PEGASYSTEMS INC (PEGA) has a current P/E ratio of 12.6, compared to its historical median P/E of 53.2. The stock is currently considered Cheap based on its historical valuation range.
PEGASYSTEMS INC (PEGA) has a 5-year average return on invested capital (ROIC) of 15.7%. This indicates strong capital allocation and a potential competitive advantage.
PEGASYSTEMS INC (PEGA) has a market capitalization of $4.5B. It is classified as a mid-cap stock.
Yes, PEGASYSTEMS INC (PEGA) pays a dividend with a trailing twelve-month yield of 0.40%. The company also returns capital through share buybacks, with a buyback yield of 12.15%.
Based on historical P/E analysis, PEGASYSTEMS INC (PEGA) appears cheap. The current P/E of 12.6 is 76% below its historical median of 53.2. The estimated fair value CAGR (P/E method) is 51.4%.
PEGASYSTEMS INC (PEGA) operates in the Services-Computer Processing & Data Preparation industry, within the Technology sector.
PEGASYSTEMS INC (PEGA) reported annual revenue of $1.7 billion in its most recent fiscal year, based on SEC EDGAR filings.
Pegasystems develops, markets, licenses, hosts, and supports enterprise software that enables organizations to optimize decisions and processes in real-time through AI-powered decisioning and workflow automation. The company's Pega Infinity platform serves multiple software markets including customer engagement and CRM, business process automation and digital process automation, low-code application development, robotic process automation, decision management, and vertical-specific industry solutions. Core products include the Pega Customer Decision Hub, an AI-powered real-time decision engine that predicts customer behavior and recommends next-best actions; Pega Customer Service applications for omnichannel support and case management; Pega Sales Automation for sales process management; and Pega Platform for workflow automation and operational efficiency. The company operates a subscription-based business model with both cloud-hosted (Pega Cloud) and term license delivery options, with Pega Cloud representing the majority of annual contract value and driving accelerated growth. Pega serves large enterprises and government agencies globally, leveraging partnerships with systems integrators and hyperscalers for sales and delivery, and recently introduced Pega Blueprint, a GenAI-powered collaboration tool that accelerates application development and deployment while shortening sales cycles and enabling new logo acquisition at scale.
【Blueprint-driven acceleration continuing】 Management expects the new pipeline built through Blueprint to convert into annual contract value in the second half of 2026 as deals progress through the sales cycle with faster motion, with unusually high new logo pipeline growth supporting this momentum. The company anticipates Pega Cloud annual contract value growth to continue accelerating above 30% in 2026, driven by CIOs and executives prioritizing productivity and efficiency gains through AI-powered automation initiatives. Management notes that enterprise clients are beginning to think meaningfully differently about AI, and the company plans to provide insight into how clients are driving legacy transformation with Pega and progress against long-term targets. The renewal portfolio is back-end loaded in 2026, resulting in higher business activity expected in the second half of the year, with subscription license revenue and term license revenue more heavily weighted toward Q3 and Q4.
| Metric | Target | Period |
|---|---|---|
| Total ACV growth | 15% | FY2026 |
| Pega Cloud ACV growth | above 30% | FY2026 |
| Professional services revenue | roughly 10% of $2 billion revenue | FY2026 |
| Pega Cloud ACV mix | 75% or more of total ACV | Long-term target |
Total ACV growth (FY2026): “Total ACV growth of 15%.”
Pega Cloud ACV growth (FY2026): “we expect Pega Cloud revenue to continue to accelerate above 30% in 2026”
Professional services revenue (FY2026): “we expect full- year professional services revenue to represent roughly 10% of our $2 billion revenue guide in 2026”
Pega Cloud ACV mix (Long-term target): “we expect it to continue as Pega Cloud ACV scales to 75% or more of our total ACV over time”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: 10-K, Q4 FY2025 Earnings Call, Q3 FY2025 Earnings Call, Q2 FY2025 Earnings Call, Q1 FY2025 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 1.7B | 1.7B | 1.5B | 1.4B | 1.3B | 1.2B |
| Net Income | 341M | 393M | 99M | 68M | -346M | -63M |
| EPS | $2.00 | $2.13 | $0.28 | $0.40 | $-2.11 | $-0.39 |
| Free Cash Flow | 495M | 491M | 338M | 201M | -13M | 29M |
| ROIC | 131.2% | 70.1% | 20.9% | 12.3% | -18.8% | -6.1% |
| Gross Margin | 75.0% | 75.9% | 73.9% | 73.6% | 72.0% | 72.2% |
| Debt/Equity | 0.00 | 0.10 | 0.94 | 1.64 | 5.26 | 1.65 |
| Dividends/Share | $0.11 | $0.11 | $0.03 | $0.06 | $0.06 | $0.06 |
| Operating Income | 173M | 263M | 124M | 81M | -109M | -95M |
| Operating Margin | 10.2% | 15.1% | 8.3% | 5.7% | -8.3% | -7.8% |
| ROE | 48.3% | 57.3% | 21.1% | 28.0% | -126.4% | -13.2% |
| Shares Outstanding | 169M | 185M | 361M | 168M | 164M | 164M |
| Metric | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 590M | 683M | 750M | 841M | 892M | 911M | 1.0B | 1.2B | 1.3B | 1.4B | 1.5B | 1.7B | 1.7B |
| Gross Margin | 68.6% | 68.7% | 69.7% | 72.4% | 66.2% | 66.0% | 69.4% | 72.2% | 72.0% | 73.6% | 73.9% | 75.9% | 75.0% |
| R&D | 109M | 126M | 146M | 163M | 182M | 205M | 237M | 261M | 294M | 296M | 298M | 313M | 320M |
| SG&A | 37M | 37M | 46M | 52M | 52M | 57M | 67M | 84M | 118M | 97M | 113M | 149M | 163M |
| EBIT | 52M | 65M | 51M | 93M | -17M | -135M | -144M | -95M | -109M | 81M | 124M | 263M | 173M |
| Op. Margin | 8.7% | 9.5% | 6.8% | 11.1% | -1.9% | -14.8% | -14.1% | -7.8% | -8.3% | 5.7% | 8.3% | 15.1% | 10.2% |
| Net Income | 33M | 36M | 45M | 99M | 11M | -90M | -61M | -63M | -346M | 68M | 99M | 393M | 341M |
| Net Margin | 5.6% | 5.3% | 6.0% | 11.7% | 1.2% | -9.9% | -6.0% | -5.2% | -26.2% | 4.7% | 6.6% | 22.5% | 20.0% |
| Non-Recurring | 192K | 0 | 287K | 0 | 0 | 0 | 0 | 0 | 22M | 22M | 4.5M | 12M | 11M |
| Returns on Capital | |||||||||||||
| ROIC | 36.0% | 19.8% | 11.4% | 22.0% | 1.7% | -15.6% | -7.7% | -6.1% | -18.8% | 12.3% | 20.9% | 70.1% | 131.2% |
| ROE | 11.7% | 8.8% | 8.4% | 16.4% | 1.7% | -15.6% | -11.4% | -13.2% | -126.4% | 28.0% | 21.1% | 57.3% | 48.3% |
| ROA | 5.9% | 6.0% | 7.0% | 11.8% | 1.1% | -9.2% | -4.7% | -3.9% | -23.4% | 4.7% | 6.0% | 23.1% | 22.0% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | 103M | 68M | 40M | 158M | 104M | -42M | -563K | 39M | 22M | 218M | 346M | 505M | 513M |
| Free Cash Flow | 92M | 57M | 21M | 144M | 92M | -53M | -26M | 29M | -13M | 201M | 338M | 491M | 495M |
| Owner Earnings | 61M | 15M | -25M | 80M | 15M | -144M | -125M | -105M | -119M | 56M | 186M | 336M | 340M |
| CapEx | 11M | 11M | 19M | 14M | 12M | 11M | 25M | 10M | 35M | 17M | 7.7M | 15M | 18M |
| Maint. CapEx | 23M | 23M | 24M | 25M | 25M | 21M | 21M | 29M | 19M | 19M | 18M | 14M | 13M |
| Growth CapEx | 0 | 0 | 0 | 0 | 0 | 0 | 4.0M | 0 | 17M | 0 | 0 | 805K | 4.9M |
| D&A | 23M | 23M | 24M | 25M | 25M | 21M | 21M | 29M | 19M | 19M | 18M | 14M | 13M |
| CapEx/OCF | 11.5% | 16.3% | 47.9% | 8.7% | 11.4% | N/A | N/A | 26.7% | 158.4% | 7.7% | 2.2% | 2.9% | 3.6% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 6.9M | 9.2M | 9.2M | 9.3M | 9.4M | 9.5M | 9.6M | 9.8M | 9.8M | 10.0M | 10M | 15M | 18M |
| Dividend Yield | 0.4% | 0.5% | 0.4% | 0.2% | 0.2% | 0.2% | 0.1% | 0.1% | 0.2% | 0.3% | 0.1% | 0.2% | 0.4% |
| Share Buybacks | 15M | 23M | 27M | 4.3M | 54M | 22M | 28M | 53M | 26M | 0 | 68M | 500M | 550M |
| Buyback Yield | 0.9% | 1.1% | 1.0% | 0.1% | 1.4% | 0.4% | 0.3% | 0.6% | 1.0% | N/A | 0.8% | 4.3% | 12.1% |
| Stock-Based Comp | 19M | 30M | 41M | 53M | 64M | 81M | 103M | 116M | 122M | 143M | 143M | 155M | 160M |
| Debt Repayment | 0 | 0 | 0 | 0 | 0 | 0 | 15M | 0 | 0 | 89M | 34M | 468M | 468M |
| Balance Sheet | |||||||||||||
| Net Debt | N/A | N/A | N/A | N/A | N/A | 132K | 131M | 323M | 391M | 158M | -190M | -350M | -474M |
| Cash & Equiv. | 115M | 93M | 71M | 162M | 114M | 68M | 172M | 160M | 145M | 230M | 337M | 212M | 474M |
| Long-Term Debt | N/A | N/A | N/A | N/A | N/A | 0 | 518M | 591M | 594M | 499M | 0 | 0 | N/A |
| Debt/Equity | 0.99 | 0.58 | 0.58 | 0.54 | 0.58 | 0.13 | 1.10 | 1.65 | 5.26 | 1.64 | 0.94 | 0.10 | 0.00 |
| Interest Coverage | 171.8 | N/A | N/A | N/A | -1703.2 | -636.2 | -7.4 | -11.9 | -14.0 | 11.8 | 18.1 | 204.7 | 573.7 |
| Equity | 295M | 527M | 549M | 656M | 622M | 539M | 542M | 416M | 131M | 354M | 585M | 787M | 706M |
| Total Assets | 588M | 628M | 655M | 1.0B | 983M | 985M | 1.6B | 1.6B | 1.4B | 1.5B | 1.8B | 1.6B | 1.6B |
| Total Liabilities | 293M | 305M | 319M | 357M | 361M | 446M | 1.1B | 1.2B | 1.2B | 1.2B | 1.2B | 844M | 845M |
| Intangibles | 46M | 33M | 44M | 32M | 21M | 20M | 16M | 14M | 11M | 7.0M | 3.8M | 1.2M | 0 |
| Retained Earnings | 153M | 180M | 198M | 510M | 511M | 411M | 340M | 276M | -77M | -8.7M | 88M | 463M | 491M |
| Working Capital | 163M | 179M | 138M | 353M | 279M | 128M | 517M | 355M | 308M | 452M | 248M | 241M | 160M |
| Current Assets | 393M | 446M | 425M | 648M | 611M | 506M | 977M | 840M | 846M | 1.0B | 1.3B | 978M | 904M |
| Current Liabilities | 230M | 267M | 287M | 295M | 332M | 378M | 460M | 485M | 539M | 577M | 1.1B | 738M | 743M |
| Per Share Data | |||||||||||||
| EPS | 0.21 | 0.23 | 0.28 | 0.60 | 0.07 | -0.57 | -0.38 | -0.39 | -2.11 | 0.40 | 0.28 | 2.13 | 2.00 |
| Owner EPS | 0.38 | 0.09 | -0.16 | 0.48 | 0.09 | -0.91 | -0.77 | -0.64 | -0.72 | 0.33 | 0.51 | 1.82 | 2.02 |
| Book Value | 1.86 | 3.34 | 3.41 | 3.96 | 3.81 | 3.40 | 3.36 | 2.54 | 0.80 | 2.11 | 1.62 | 4.26 | 4.18 |
| Cash Flow/Share | 0.65 | 0.43 | 0.25 | 0.96 | 0.64 | -0.27 | -0.00 | 0.24 | 0.14 | 1.30 | 0.96 | 2.74 | 2.10 |
| Dividends/Share | 0.05 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.03 | 0.11 | 0.11 |
| Shares Out. | 158.4M | 157.9M | 160.8M | 165.6M | 163.3M | 158.7M | 161.5M | 163.7M | 163.8M | 167.7M | 360.7M | 184.7M | 168.8M |
| Valuation | |||||||||||||
| P/E Ratio | 49.7 | 59.4 | 103.8 | 38.9 | 359.6 | N/A | N/A | N/A | N/A | 67.4 | 85.7 | 29.3 | 13.4 |
| P/FCF | 18.0 | 38.0 | 136.4 | 26.5 | 41.3 | N/A | N/A | 316.8 | N/A | 20.5 | 50.3 | 23.5 | 9.1 |
| EV/EBIT | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 57.4 | 70.2 | 42.2 | 23.4 |
| Price/Book | 5.6 | 6.7 | 8.3 | 5.8 | 6.1 | 11.6 | 19.7 | 21.8 | 20.4 | 12.9 | 14.5 | 14.6 | 6.4 |
| Price/Sales | 2.7 | 2.7 | 2.9 | 4.7 | 5.2 | 6.0 | 8.1 | 8.5 | 3.5 | 3.0 | 4.0 | 5.4 | 2.7 |
| FCF Yield | 5.6% | 2.6% | 0.7% | 3.8% | 2.4% | -0.8% | -0.2% | 0.3% | -0.5% | 4.4% | 4.0% | 4.3% | 10.9% |
| Market Cap | 1.7B | 2.2B | 2.8B | 3.8B | 3.8B | 6.2B | 10.7B | 9.1B | 2.7B | 4.6B | 8.5B | 11.5B | 4.5B |
| Avg. Price | 10.05 | 11.59 | 13.57 | 25.12 | 28.13 | 34.28 | 50.95 | 63.03 | 28.29 | 22.85 | 33.27 | 50.73 | 26.82 |
| Year-End Price | 10.43 | 13.67 | 17.64 | 23.13 | 23.38 | 39.26 | 65.97 | 55.46 | 16.29 | 24.61 | 47.12 | 62.40 | 26.82 |
PEGASYSTEMS INC passes 7 of 9 quality checks, indicating strong fundamentals.
PEGASYSTEMS INC trades at 12.6x trailing earnings, compared to its 15-year median P/E of 53.2x, suggesting it is currently Cheap relative to its historical range. On a free-cash-flow basis, the stock trades at 9.2x vs a median of 26.5x. The company's 5-year average ROIC is 15.7% with a gross margin of 73.5%. Total shareholder yield (dividends + buybacks) is 12.5%. At current prices, the estimated annualized return to fair value is +42.1%.
PEGASYSTEMS INC (PEGA) has a net profit margin of 22.5%. This is a strong margin indicating high profitability.
PEGASYSTEMS INC (PEGA) generated $491 million in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
PEGASYSTEMS INC (PEGA) has a debt-to-equity ratio of 0.10. This indicates a conservatively financed balance sheet.
PEGASYSTEMS INC (PEGA) reported earnings per share (EPS) of $2.13 in its most recent fiscal year.
PEGASYSTEMS INC (PEGA) has a return on equity (ROE) of 57.3%. This indicates the company generates strong returns for shareholders.
PEGASYSTEMS INC (PEGA) has a 5-year average gross margin of 73.5%. This high margin suggests strong pricing power and a potential competitive moat.
The Ledger Terminal provides 17 years of financial data for PEGASYSTEMS INC (PEGA), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
PEGASYSTEMS INC (PEGA) has a book value per share of $4.26, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects the new pipeline built through Blueprint to convert into annual contract value in the second half of 2026 as deals progress through the sales cycle with faster motion, with unusually high new logo pipeline growth supporting this momentum. The company anticipates Pega Cloud annual contract value growth to continue accelerating above 30% in 2026, driven by CIOs and executives prioritizing productivity and efficiency gains through AI-powered automation initiatives. Management notes that enterprise clients are beginning to think meaningfully differently about AI, and the company plans to provide insight into how clients are driving legacy transformation with Pega and progress against long-term targets. The renewal portfolio is back-end loaded in 2026, resulting in higher business activity expected in the second half of the year, with subscription license revenue and term license revenue more heavily weighted toward Q3 and Q4.
Based on recent SEC filings and earnings calls, PEGASYSTEMS INC (PEGA) has provided the following forward guidance: Total ACV growth: 15% (FY2026); Pega Cloud ACV growth: above 30% (FY2026); Professional services revenue: roughly 10% of $2 billion revenue (FY2026); Pega Cloud ACV mix: 75% or more of total ACV (Long-term target).