A Business at a Glance
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Q2 Holdings, Inc.
QTWO
$3.6B
Mkt Cap
$54.61
+3.27%
Q2 Holdings, Inc. (QTWO) has a current P/E ratio of 68.3, compared to its historical median P/E of 93.1. The stock is currently considered Cheap based on its historical valuation range.
Q2 Holdings, Inc. (QTWO) has a 5-year average return on invested capital (ROIC) of -4.8%. This is below average and may indicate limited pricing power.
Q2 Holdings, Inc. (QTWO) has a market capitalization of $3.4B. It is classified as a mid-cap stock.
Q2 Holdings, Inc. (QTWO) does not currently pay a regular dividend. However, the company returns capital to shareholders through share buybacks, with a buyback yield of 0.15%.
Based on historical P/E analysis, Q2 Holdings, Inc. (QTWO) appears cheap. The current P/E of 68.3 is 27% below its historical median of 93.1.
Q2 Holdings, Inc. (QTWO) operates in the Services-Prepackaged Software industry, within the Technology sector.
Q2 Holdings, Inc. (QTWO) reported annual revenue of $795 million in its most recent fiscal year, based on SEC EDGAR filings.
Table of Contents Q2 is a leading provider of digital solutions to financial institutions, financial technology companies, or FinTechs, and alternative finance companies, or Alt-FIs, seeking to incorporate banking into their customer engagement and servicing strategies. Our solutions transform the ways in which financial institutions and other financial services providers engage with account holders and retail and commercial End Users. Digital financial services are highly regulated, subject to extensive and evolving supervisory, consumer protection, privacy and third‑party risk management requirements, and security is paramount, as providers must protect sensitive financial data and funds and defend against continually evolving cyber threats and fraud.
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 822M | 795M | 696M | 625M | 566M | 499M |
| Net Income | 74M | 52M | -39M | -65M | -109M | -113M |
| EPS | $1.18 | $0.80 | $-0.64 | $-1.12 | $-1.90 | $-2.00 |
| Free Cash Flow | 202M | 195M | 129M | 65M | 25M | 11M |
| ROIC | 11.4% | 6.7% | -4.4% | -6.5% | -9.9% | -9.7% |
| Gross Margin | 55.6% | 54.1% | 50.9% | 48.5% | 45.3% | 45.1% |
| Debt/Equity | 0.50 | 0.52 | 1.05 | 1.22 | 1.74 | 1.09 |
| Dividends/Share | $0.00 | - | - | - | - | - |
| Operating Income | 65M | 40M | -42M | -86M | -105M | -78M |
| Operating Margin | 8.0% | 5.0% | -6.1% | -13.8% | -18.5% | -15.6% |
| ROE | 12.1% | 8.8% | -8.0% | -15.1% | -22.0% | -18.6% |
| Shares Outstanding | 63M | 65M | 60M | 58M | 57M | 56M |
| Metric | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 79M | 109M | 150M | 194M | 241M | 315M | 403M | 499M | 566M | 625M | 696M | 795M | 822M |
| Gross Margin | 41.8% | 45.7% | 48.5% | 48.7% | 49.5% | 48.5% | 43.4% | 45.1% | 45.3% | 48.5% | 50.9% | 54.1% | 55.6% |
| R&D | 12M | 22M | 32M | 40M | 51M | 76M | 97M | 117M | 130M | 137M | 143M | 154M | 158M |
| SG&A | 17M | 23M | 32M | 37M | 45M | 57M | 71M | 78M | 90M | 110M | 123M | 126M | 125M |
| EBIT | -19M | -25M | -36M | -27M | -32M | -67M | -100M | -78M | -105M | -86M | -42M | 40M | 65M |
| Op. Margin | -24.1% | -22.8% | -23.8% | -13.9% | -13.2% | -21.2% | -24.8% | -15.6% | -18.5% | -13.8% | -6.1% | 5.0% | 8.0% |
| Net Income | -20M | -25M | -36M | -26M | -35M | -71M | -138M | -113M | -109M | -65M | -39M | 52M | 74M |
| Net Margin | -24.8% | -23.0% | -24.2% | -13.5% | -14.7% | -22.5% | -34.2% | -22.6% | -19.3% | -10.5% | -5.5% | 6.5% | 9.0% |
| Non-Recurring | 0 | 0 | -164K | -33K | -19K | -287K | -151K | -389K | -109K | -55K | 0 | 0 | 0 |
| Returns on Capital | |||||||||||||
| ROIC | -80.3% | -25.5% | -33.3% | -25.3% | -15.8% | -12.4% | -13.7% | -9.7% | -9.9% | -6.5% | -4.4% | 6.7% | 11.4% |
| ROE | -92.1% | -25.5% | -33.3% | -25.3% | -26.7% | -26.3% | -26.9% | -18.6% | -22.0% | -15.1% | -8.0% | 8.8% | 12.1% |
| ROA | -19.8% | -14.7% | -17.9% | -12.6% | -10.5% | -9.6% | -11.3% | -8.0% | -8.0% | -5.1% | -3.1% | 4.0% | 5.9% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | -5.3M | 5.4M | 3.4M | 9.5M | 4.6M | 567K | -2.9M | 31M | 37M | 70M | 136M | 201M | 214M |
| Free Cash Flow | -10M | -1.7M | -11M | -2.8M | -8.7M | -13M | -27M | 11M | 25M | 65M | 129M | 195M | 202M |
| Owner Earnings | -14M | -8.8M | -21M | -26M | -42M | -68M | -105M | -80M | -90M | -81M | -22M | 61M | 77M |
| CapEx | 5.0M | 7.1M | 14M | 12M | 13M | 14M | 24M | 20M | 11M | 5.7M | 6.7M | 6.8M | 13M |
| Maint. CapEx | 4.1M | 6.8M | 12M | 15M | 17M | 28M | 52M | 55M | 62M | 72M | 69M | 53M | 51M |
| Growth CapEx | 953K | 281K | 2.2M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| D&A | 4.1M | 6.8M | 12M | 15M | 17M | 28M | 52M | 55M | 62M | 72M | 69M | 53M | 51M |
| CapEx/OCF | N/A | 132.0% | 422.8% | 130.0% | 289.1% | 2444.4% | N/A | 63.5% | 30.5% | 8.1% | 4.9% | 3.4% | 5.9% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend Yield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Share Buybacks | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 5.0M | 5.0M |
| Buyback Yield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 0.1% | 0.1% |
| Stock-Based Comp | 4.6M | 7.4M | 13M | 21M | 30M | 41M | 51M | 56M | 65M | 79M | 89M | 87M | 86M |
| Debt Repayment | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 64M | 0 | 150M | 942K | 0 | 0 |
| Balance Sheet | |||||||||||||
| Net Debt | -89M | N/A | N/A | -100M | 5.6M | 338M | 62M | 194M | 298M | 222M | 94M | -87M | -75M |
| Cash & Equiv. | 68M | 67M | 55M | 58M | 108M | 100M | 408M | 323M | 200M | 230M | 359M | 368M | 379M |
| Long-Term Debt | 0 | N/A | N/A | 0 | 183M | 425M | 557M | 552M | 658M | 490M | 302M | 0 | N/A |
| Debt/Equity | 0.00 | 0.73 | 1.01 | 0.00 | 1.15 | 1.24 | 0.93 | 1.09 | 1.74 | 1.22 | 1.05 | 0.52 | 0.50 |
| Interest Coverage | -45.5 | -117.2 | -164.6 | -395.7 | -39.3 | -23.4 | -24.4 | -25.1 | -36.2 | -34.0 | -15.8 | 14.2 | 14.2 |
| Equity | 79M | 118M | 100M | 107M | 159M | 379M | 643M | 570M | 419M | 448M | 518M | 662M | 612M |
| Total Assets | 137M | 204M | 201M | 213M | 464M | 1.0B | 1.4B | 1.4B | 1.3B | 1.2B | 1.3B | 1.3B | 1.2B |
| Total Liabilities | 58M | 86M | 101M | 106M | 305M | 630M | 773M | 815M | 931M | 753M | 777M | 614M | 635M |
| Intangibles | 0 | 17M | 15M | 12M | 63M | 224M | 185M | 162M | 146M | 122M | 95M | 78M | 76M |
| Retained Earnings | -64M | -89M | -126M | -152M | -172M | -243M | -381M | -494M | -560M | -626M | -664M | -612M | -586M |
| Working Capital | 72M | 88M | 66M | 63M | 145M | 53M | 470M | 354M | 339M | 236M | 160M | 12M | -38M |
| Current Assets | 105M | 133M | 126M | 131M | 218M | 186M | 616M | 522M | 531M | 428M | 559M | 556M | 525M |
| Current Liabilities | 32M | 46M | 59M | 68M | 74M | 133M | 146M | 168M | 192M | 192M | 399M | 544M | 562M |
| Per Share Data | |||||||||||||
| EPS | -0.67 | -0.67 | -0.92 | -0.63 | -0.83 | -1.53 | -2.65 | -2.00 | -1.90 | -1.12 | -0.64 | 0.80 | 1.18 |
| Owner EPS | -0.48 | -0.24 | -0.54 | -0.64 | -0.98 | -1.48 | -2.03 | -1.41 | -1.57 | -1.38 | -0.37 | 0.94 | 1.22 |
| Book Value | 2.69 | 3.15 | 2.54 | 2.57 | 3.73 | 8.19 | 12.39 | 10.12 | 7.31 | 7.68 | 8.60 | 10.18 | 9.76 |
| Cash Flow/Share | -0.18 | 0.14 | 0.09 | 0.23 | 0.11 | 0.01 | -0.06 | 0.55 | 0.64 | 1.20 | 2.25 | 3.10 | 2.00 |
| Dividends/Share | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 0.00 |
| Shares Out. | 29.3M | 37.4M | 39.5M | 41.5M | 42.6M | 46.3M | 51.9M | 56.4M | 57.4M | 58.4M | 60.2M | 65.0M | 62.7M |
| Valuation | |||||||||||||
| P/E Ratio | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 93.1 | 46.3 |
| P/FCF | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 393.5 | 55.4 | 39.9 | 48.2 | 24.9 | 17.0 |
| EV/EBIT | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 125.8 | 51.2 |
| Price/Book | 7.4 | 8.6 | 11.4 | 14.4 | 13.0 | 10.1 | 10.2 | 7.8 | 3.4 | 5.7 | 12.0 | 7.3 | 5.6 |
| Price/Sales | 5.6 | 8.3 | 6.9 | 8.1 | 9.3 | 10.8 | 11.4 | 11.3 | 4.7 | 2.9 | 5.8 | 6.6 | 4.2 |
| FCF Yield | -1.8% | -0.2% | -1.0% | -0.2% | -0.4% | -0.3% | -0.4% | 0.3% | 1.8% | 2.5% | 2.1% | 4.0% | 5.9% |
| Market Cap | 586M | 1.0B | 1.1B | 1.5B | 2.1B | 3.8B | 6.6B | 4.5B | 1.4B | 2.6B | 6.2B | 4.8B | 3.4B |
| Avg. Price | 15.02 | 24.23 | 26.06 | 37.77 | 52.59 | 73.45 | 88.48 | 99.56 | 45.94 | 31.06 | 66.99 | 80.95 | 54.61 |
| Year-End Price | 20.00 | 27.10 | 29.00 | 36.85 | 48.27 | 82.44 | 126.93 | 79.15 | 24.53 | 44.15 | 103.36 | 74.52 | 54.61 |
Q2 Holdings, Inc. passes 3 of 9 quality checks, indicating weak fundamentals.
Q2 Holdings, Inc. trades at 68.3x trailing earnings, compared to its 15-year median P/E of 93.1x, suggesting it is currently Cheap relative to its historical range. On a free-cash-flow basis, the stock trades at 17.5x vs a median of 44.1x. The company's 5-year average gross margin is 48.8%. Total shareholder yield (buybacks) is 0.1%. At current prices, the estimated annualized return to fair value is +84.5%.
Q2 Holdings, Inc. (QTWO) has a net profit margin of 6.5%. This is a modest margin.
Q2 Holdings, Inc. (QTWO) generated $195 million in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
Q2 Holdings, Inc. (QTWO) has a debt-to-equity ratio of 0.52. This indicates moderate leverage.
Q2 Holdings, Inc. (QTWO) reported earnings per share (EPS) of $0.80 in its most recent fiscal year.
Q2 Holdings, Inc. (QTWO) has a return on equity (ROE) of 8.8%. This indicates moderate shareholder returns.
Q2 Holdings, Inc. (QTWO) has a 5-year average gross margin of 48.8%. This indicates decent pricing power.
The Ledger Terminal provides 14 years of financial data for Q2 Holdings, Inc. (QTWO), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
Q2 Holdings, Inc. (QTWO) has a book value per share of $10.18, based on its most recent annual SEC filing.
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