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Fundamental analysis: The Descartes Systems Group Inc. (DSGX)

Awarener score: 5.8

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 8.0

• Business has been growing at a good pace. It's been almost average when measured against peer companies.
• The Descartes Systems Group Inc. business trend stability is excellent. The higher the stability, the lower the risk. It looks well ranked against rivals.

Margins score: 8.7

• DSGX profit margins -on goods and services sold- are usually huge. They stand somewhat better than rival companies.
• Business profit on sales tends to be excellent. It's top tier when measured against competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually excellent. They remain impressive in relation to peers.
• Earnings -before income taxes and interests on loans taken- tend to be very good in relation to total revenues. They're still top-notch against similar companies.
• Profits -before income taxes- are usually very good considering total sales, and remain top tier when measured against rivals.
• Total net profit tends to be very good when confronted to sales. Company stands top tier when measured against comparable firms.

Growth score: 7.0

• The Descartes Systems Group Inc. profit -on goods and services sold- has been growing at a normal pace. It's been close to average when compared to competitors.
• In recent years, earnings -on operations- have been growing at a good step, which has been somewhat better than comparable firms.
• Profits -available to repay debt and purchase properties- have been growing at a good pace, which compares encouraging in relation to peer enterprises.
• Earnings -before income taxes and interests on loans taken- have been growing at a good tempo. It turns to be a slight improvement compared to similar stocks.
• In past years, profits -before income taxes- grew at a good speed. It was slightly better than rivals.
• In the previous years, growth trend on total net profit has been very good, and encouraging in relation to peer companies.
• Earnings per share have grown at a good rhythm in past years. It's been a slight improvement compared to industry peers.

Miscellaneous score: 6.0

• DSGX had to pay sparse income taxes in relation to profits made in the past years. It's been somewhat worse than peers.
• Research and development expenses consume a moderate portion of revenues. It's encouraging in relation to competitors.
• The company grows modestly in relation to research and development efforts. It stands lacking compared to rival companies.

Profitability score: 7.8

• The Descartes Systems Group Inc. usually gets very good returns on the resources it controls. It proves great when measured against peer firms.
• The company normally gets good proceeds -on the resources directly invested in the business-. They remain excellent in relation to similar companies.
• There's usually some profitability -in relation to owned resources-. It ranks more than average in relation to competitors.
• In the past, got huge returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's top tier when measured against comparable enterprises.

Usage of Funds score: 4.2

• DSGX usually uses a modest portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments isn't too high. It stands top tier when measured against rival firms.
• The company is usually not replacing property, plant, and equipment that gets old, instead using funds in something else. It can't keep forever, which is last-in-rank when measured against industry peers.
• In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
• The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
• As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
• The company somewhat enlarges a bit the pool of investors, resulting in more mouths feeding on the pie of profits. It remains in good shape compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands rather normal in relation to rivals.
• We do not have sufficient data to comment on buybacks and their sustainability. It still looks dubious against competitors.

Balance Sheet score: 6.7

• The Descartes Systems Group Inc. intangible assets (like brands and goodwill) represent a significant portion of resources controlled, according to accounting books. There could be significant difficulties in liquidating them if the company ever gets in financial distress. It happens to be below average when measured against peer companies.
• The company has roughly double short-term resources than short-term obligations. Liquidity concerns are normally not an issue. It turns to be rather normal in relation to similar firms.
• Almost no resources controlled were provided for with financial debt. Financial strength is great. Company could significantly increase debt if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains better than most rival firms.
• Most controlled resources might be only slowly turned into cash and equivalents, which is risky. It looks substantially worse when measured against rivals.
• For every dollar of short-term obligations, the company has more than enough dollars in cash and short-term receivables. It's rather normal in relation to peer firms.
• For every dollar of short-term obligations, the company has enough dollars in cash and equivalents, which is slightly better than similar enterprises.
• Usually, sales are on a two-months credit. It still ranks encouraging in relation to peers.
• Normally has approximately only a couple of weekly sales worth in inventory. It comes up as a slight improvement compared to competitors.
• On average, it takes approximately two months from the purchase to charging customers. It happens to be somewhat better than peers.
• On average pays suppliers after a month and a half from the purchase. It ranks similar to industry peers.
• The company pays its suppliers less than one month before charging its customers, so there's little money invested in working capital. It's rather normal in relation to similar companies.
• Net interest expenses consume a non-significant portion of usual business earnings, and are therefore extremely easily to bear. It stands well ranked against rival firms.
• Business earnings have usually been great when measured against loans taken. Debt might be repaid almost as soon as desired. It ranks top tier when measured against comparable enterprises.
• Revenues are excellent in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. Low property, plant, and equipment requirements, allows the company to keep more money to reward stockholders in the long run. It looks in good shape compared to similar firms.
• Resource exploitation is slightly low when yearly sales are considered, business volume should be increased. This metric is normally tied to the industry where the firm belongs. It's still somewhat worse than peer companies.

Valuation score: 3.9

• The Descartes Systems Group Inc. profits are really small compared to market valuation, market valuation doesn't rely on current earnings. It happens to be below average when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in a very weak position compared to peers.
• In the past twelve months, the company generated some free funds in relation to the stock price, which stands well ranked against similar companies.
• In the past years the company barely generated enough genuine funds to cover up for its business needs. Business prospects should improve to be in a better position to reward investors. It's still encouraging in relation to industry firms.
• In the past twelve months, the company has slightly enlarged the pool of investors by issuing new shares. The pie of earnings will now be split among a little more stockholders. It came up in good shape compared to peer ventures.
• The company has more cash than debt. It might be poised to increase stockholder payments, or to fund new business projects. It looks slightly better than similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation is huge, as profits were extremely low in relative terms. It ranks below average when measured against peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a huge relationship. The stock price might rely more on expectations and resources controlled than on anything else. It looks a disappointment compared to rival firms.
• The relation between the stock price and accounting book value is really high, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains somewhat worse than peer firms.
• In the past twelve months, the operating business lost a little money. It happens to be more than average in relation to industry peers.
• In an alternate metric of bang for the buck, the company has usually shown a mediocre earnings power ability when measured against the current stock price and financial position. It's still in good shape compared to peer companies.

Total score: 6.5

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Awarener score: 5.8

Conclusion

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