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PRGSProgress Software program$54.26 +0.02 (+0.04%) (As of 06/28/2024 ET)52-Week Vary$48.00▼$62.34Dividend Yield1.29percentP/E Ratio33.09Price Goal$63.14
Progress Software program NASDAQ: PRGS is a expertise firm throughout the programs software program sub-industry. The inventory reached its 2024 low on Jun. 20, when it was down practically 11% yr so far. The agency reported its second-quarter monetary outcomes on Jun. 25, 2024, and is again within the inexperienced, now up nearly 2% on the yr. The agency’s outcomes impressed the market, with the inventory taking pictures up practically 13% on the day following the discharge. Let’s discover Progress Software program’s merchandise, latest monetary outcomes, and outlook to know whether or not it is a identify to contemplate including.
Get Oracle alerts:Signal UpExplore Progress Software program’s Product Lineup: AI-Powered Options for Builders
The agency’s 2023 annual monetary report, or Type 10-Okay, gives descriptions of 12 completely different software program merchandise the agency gives. The agency’s foremost merchandise enable software program builders to create, deploy, and handle their purposes extra effectively. It additionally gives software program that allows safe file switch and an answer that allows knowledge sharing between completely different purposes. Among the most notable merchandise embrace Progress OpenEdge, Progress Chef, and Progress Developer Instruments. Many of those merchandise are AI-powered.
The agency monetizes these merchandise primarily by way of perpetual licenses, which permit using the software program indefinitely. It additionally gives renewable time period licenses on some merchandise and a subscription mannequin for its cloud-based choices. Together with its licenses, the agency additionally gives product upkeep that provides entry to software program updates and technical help. Purchasers of perpetual licenses have the choice, however not the requirement, so as to add upkeep help. The agency really makes the vast majority of its revenues from its upkeep companies. 58% of whole income got here from this stream in 2023.
Progress doesn’t establish any direct opponents in its annual submitting, however some corporations that provide related merchandise embrace Amazon (NASDAQ: AMZN), Microsoft NASDAQ: MSFT, and Oracle NYSE: ORCL.
Progress Software program’s Spectacular Monetary Outcomes: Surpassing Expectations
Outcomes surpassed expectations on many fronts. Second-quarter revenues have been $175 million, beating out the $170 million steerage midpoint and the $169 million consensus estimate. Earnings per share (EPS) additionally beat expectations, coming in at $1.09, properly above the steerage midpoint and consensus estimate of $0.95.
Different important measures shined as properly. Annual recurring income (ARR) was $579 million. This measures the worth of all contractually binding agreements the agency has in place. Contracts present a dependable income, ensured by their authorized binding. About 83% of the agency’s whole income comes from yearly recurring sources. The Internet Retention Price was 99%, which measures the agency’s skill to resume or change annual recurring income.

Days Gross sales Excellent (DSO) has additionally been constantly enhancing. DSO measures what number of days it takes to transform gross sales bought on credit score into money.  DSO was at 50 days in Q2 2023 and dropped to 44 days in Q1 2024. It fell once more to 41 days in Q2 2024. This reveals the agency is getting paid by prospects sooner and is constantly changing into extra succesful in that space. Lastly, adjusted free money move grew by 33% from Q2 2023. Total, this was a powerful report from Progress.
Progress Software program’s Steerage and Outlook: Elevated 2024 Income and EPS Projections
Not solely did Progress present spectacular backward-looking outcomes, but it surely additionally raised its future expectations. The corporate raised its fiscal yr 2024 income steerage by $3 million and elevated its EPS by 5 cents. Analysts are bullish on the inventory, with 5 purchase rankings and two holds.
The common value forecast sits at $63.14, implying a 15% upside. The agency has a projected earnings progress fee of 9%, on the low facet relative to its {industry}.
Total MarketRank™3.98 out of 5 Analyst RatingModerate Purchase Upside/Downside16.4% Upside Brief InterestBearish Dividend StrengthModerate Sustainability-0.67 Information Sentiment0.59 Insider TradingSelling Shares Projected Earnings Growth9.09% See Full Particulars
Within the agency’s quarterly earnings convention name, executives detailed the initiatives the agency is pursuing going ahead. These embrace additional integrating generative AI into its merchandise and utilizing AI internally to optimize the corporate’s operations.
The agency can be actively concerned in M&A exercise. It’s at present conducting due diligence on the potential acquisition of Irish software program firm MariaDB.

Progress Software program’s latest earnings report was spectacular, however the modest implied upside and projected progress are regarding. Nevertheless, the agency has made a behavior of constantly beating its estimates, so it is doable it could actually do significantly better than analysts count on over the long run.Earlier than you think about Oracle, you will wish to hear this.MarketBeat retains observe of Wall Road’s top-rated and greatest performing analysis analysts and the shares they advocate to their shoppers each day. MarketBeat has recognized the 5 shares that high analysts are quietly whispering to their shoppers to purchase now earlier than the broader market catches on… and Oracle wasn’t on the checklist.Whereas Oracle at present has a “Reasonable Purchase” ranking amongst analysts, top-rated analysts imagine these 5 shares are higher buys.View The 5 Shares Right here With common beneficial properties of 150% because the begin of 2023, now’s the time to provide these shares a glance and pump up your 2024 portfolio.Get This Free Report

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