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SS&C Technologies Holdings (SSNC)
NASDAQ:SSNC
RESEARCH TOOLSreports
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SS&C Technologies Holdings
(NASDAQ:SSNC)78Outperform
Positive Factors
Acquisitions
SSNC recently acquired Battea-Class Action Services, which is expected to be accretive to growth and margins while adding cross-selling opportunities.
Organic Growth
SSNC's posted 4Q results which topped expectations on the back of solid organic growth which came in at 7% Y/Y as all of SSNCs core businesses delivered healthy growth.
Negative Factors
Growth Challenges
The 4Q guide was mixed and calls for a deceleration in organic growth (2.4% Y/Y at the midpoint), largely due to a tough compare and may also reflect added conservatism given the still uncertain climate.
SS&C Technologies Holdings (SSNC) vs. S&P 500 (SPY)
Market Cap
$22.06B
Dividend Yield1.11%
Average Volume (3M)1.52M
Price to Earnings (P/E)29.7
Beta (1Y)1.01
Revenue Growth6.89%
EPS Growth26.17%
CountryUS
Employees26,600
SectorTechnology
Sector Strength48
IndustrySoftware
Share Statistics
EPS (TTM)3.00
Shares Outstanding247,685,130
10 Day Avg. Volume1,488,802
30 Day Avg. Volume1,519,492
Financial Highlights & Ratios
PEG Ratio1.13
Price to Book (P/B)N/A
Price to Sales (P/S)3.83
Price to Cash Flow (P/CF)16.40
P/FCF Ratio16.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$95.25Price Target Upside10.38% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
SS&C Technologies Holdings Business Overview & Revenue Model
Company DescriptionSS&C Technologies Holdings, Inc. engages in the development and provision of software solutions. Its portfolio of products provides functions including trading and modeling, middle-office functions such as portfolio management and reporting, and back-office functions such as accounting, performance measurement, reconciliation, reporting, processing and clearing. It also caters to the institutional asset and wealth management, alternative investment management, financial advisory, and financial institutions vertical markets. The firm's services include managed, professional, technology & operations outsourcing and fund administration services. The company was founded by William Charles Stone in February 1986 and is headquartered in Windsor, CT.
How the Company Makes MoneySS&C Technologies Holdings generates revenue through a combination of software licensing, maintenance and support fees, and professional services. The company's key revenue streams include software-enabled services, which provide integrated solutions for investment operations, and software licensing, where clients pay for the use of SS&C's proprietary software. Additionally, SS&C benefits from recurring revenue through ongoing support and maintenance contracts. The company also engages in strategic acquisitions to expand its product offerings and client base, enhancing its ability to generate income. Significant partnerships with major financial institutions further bolster SS&C's earnings by fostering long-term client relationships and facilitating cross-selling opportunities.
SS&C Technologies Holdings Financial Statement Overview
Summary
SS&C Technologies Holdings demonstrates solid financial performance across all verticals. The company shows strong revenue growth, improved profitability, and efficient cash flow generation. The reduction in debt and high return on equity are positive indicators of financial health. While there is a high liability level, the company's operational and cash flow strengths mitigate potential risks, positioning it well for future growth.Income Statement
SS&C Technologies Holdings shows strong income statement performance. Gross profit margin is robust at approximately 48.68% for TTM, indicating efficient cost management. The net profit margin has improved to 12.93% from the previous year, suggesting enhanced profitability. Revenue growth rate is healthy at 6.89% TTM, indicating positive business expansion. EBIT and EBITDA margins are strong at 23.19% and 31.54%, respectively, showcasing excellent operational efficiency.85
Very Positive
Balance Sheet
The balance sheet reflects a solid financial position with a debt-to-equity ratio of 0.03 in TTM, significantly reduced from previous years due to lower total debt. The return on equity is strong at 11.51%, indicating effective use of equity to generate profits. The equity ratio is stable at 34.69%, reflecting a balanced asset financing structure. While the reduction in debt is positive, the relatively high liabilities compared to assets may still pose potential risks.78
Positive
Cash Flow
Cash flow analysis reveals a strong free cash flow growth rate of 37.77% TTM, driven by improved operating cash flows. The operating cash flow to net income ratio stands at 1.83, indicating strong cash generation relative to net earnings. The free cash flow to net income ratio is robust at 1.74, reflecting efficient capital expenditure management. Overall, cash flow generation is strong, supporting further investment and debt reduction.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 5.88B | 5.50B | 5.28B | 5.05B | 4.67B | Gross Profit |
| 2.86B | 2.65B | 2.52B | 2.41B | 2.09B | EBIT |
| 1.34B | 1.24B | 1.14B | 1.24B | 985.80M | EBITDA |
| 1.34B | 2.00B | 1.86B | 1.91B | 1.75B | Net Income Common Stockholders |
| 760.50M | 607.10M | 650.20M | 800.00M | 625.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 570.80M | 432.20M | 440.10M | 564.00M | 209.30M | Total Assets |
| 19.04B | 18.10B | 16.65B | 17.33B | 15.92B | Total Debt |
| 195.10M | 6.92B | 7.32B | 6.22B | 6.77B | Net Debt |
| -375.70M | 6.49B | 6.88B | 5.65B | 6.56B | Total Liabilities |
| 12.44B | 11.70B | 10.55B | 11.11B | 10.21B | Stockholders Equity |
| 6.53B | 6.34B | 6.04B | 6.17B | 5.72B |
| Cash Flow | Free Cash Flow | |||
| 1.33B | 963.60M | 926.00M | 1.29B | 1.08B | Operating Cash Flow |
| 1.39B | 1.22B | 1.13B | 1.43B | 1.18B | Investing Cash Flow |
| -855.70M | -268.40M | -1.76B | -148.20M | -210.50M | Financing Cash Flow |
| -152.30M | 712.80M | -1.18B | 556.70M | -1.43B |
SS&C Technologies Holdings Technical Analysis
Neutral
86.29
Price Trends
81.21
Positive
77.81
Positive
72.76
Positive
Market Momentum
1.94
Positive
55.01
Neutral
36.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSNC, the sentiment is Neutral. The current price of 86.29 is below the 20-day moving average (MA) of 86.98, above the 50-day MA of 81.21, and above the 200-day MA of 72.76, indicating a neutral trend. The MACD of 1.94 indicates Positive momentum. The RSI at 55.01 is Neutral, neither overbought nor oversold. The STOCH value of 36.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SSNC.
SS&C Technologies Holdings Risk Analysis
SS&C Technologies Holdings disclosed 42 risk factors in its most recent earnings report. SS&C Technologies Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SS&C Technologies Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $171.61B | 57.36 | 16.92% | 0.65% | 13.73% | 9.93% | |
78 Outperform | $28.23B | 37.74 | 34.07% | 1.37% | 5.73% | 11.41% | |
78 Outperform | $22.06B | 29.68 | 11.64% | 1.11% | 6.89% | 26.17% | |
77 Outperform | $127.53B | 32.70 | 77.46% | 1.80% | 7.09% | 11.51% | |
77 Outperform | $12.90B | 31.92 | 20.51% | 1.24% | 5.36% | 8.62% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% | |
51 Neutral | $37.02B | 49.29 | 2397.44% | 1.99% | -17.38% | ― |
* Technology Sector Average
Performance Comparison
SSNC
SS&C Technologies Holdings
86.29
24.49
39.63%
ADP
Automatic Data Processing
313.44
74.92
31.41%
BR
Broadridge Financial Solutions
241.83
42.02
21.03%
FIS
Fidelity National Info
69.89
1.34
1.95%
INTU
Intuit
598.07
-48.24
-7.46%
JKHY
Jack Henry & Associates
177.02
4.91
2.85%
SS&C Technologies Holdings Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: 5.79% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial performance with record revenues and earnings, driven by growth in key segments and strategic initiatives. However, challenges such as increased core expenses and potential volatility in the healthcare segment were noted. Overall, the positive aspects of the report significantly outweighed the negatives.Highlights
Record-Breaking Revenue and Growth
SS&C Technologies Holdings reported record adjusted revenue of $1.531 billion, representing an 8.4% increase. Adjusted diluted earnings per share reached $1.58, up 25.4%, and adjusted consolidated EBITDA was $599.1 million, up 6.5%.
Strong Performance in Key Segments
The company experienced strong growth in global operations, wealth and investment technology, and global investor distribution services. Wealth and Investment Technologies grew 6.8% for the quarter, and GlobeOp saw many new business wins contributing to 8% organic growth.
Successful Strategic Initiatives
SS&C entered into a strategic agreement with Insignia Financial to deliver superannuation member administrative services in Australia, with significant future potential given their 5% market share.
Share Repurchases and Cash Flow
The company bought back 4.9 million shares for $365 million, and cash from operating activities was $486.6 million, up 25.3% from the previous year.
Improved Financial Metrics
The adjusted non-GAAP effective tax rate was revised to 23.1%, increasing reported adjusted EPS by approximately $0.21.
Lowlights
Increased Core Expenses
Core expenses increased by 8.3% or $72 million, driven by higher incentive compensation, commissions, and wages.
Foreign Exchange Impact
Foreign exchange had a minimal favorable impact of approximately $2 million, indicating potential vulnerability to currency fluctuations.
Healthcare Business Lumps
The healthcare segment experienced a few large license deals in Q4, highlighting potential volatility and difficulty in projecting future revenues.
Company Guidance
During the SS&C Technologies Holdings, Inc. fourth quarter and full year 2024 earnings call, the company provided guidance for the first quarter and full year 2025. They expect Q1 2025 revenue to range between $1.474 billion and $1.514 billion, with an adjusted net income range of $348 million to $364 million and an adjusted diluted EPS of $1.37 to $1.43. For the full year 2025, they anticipate revenue between $6.085 billion and $6.245 billion, with adjusted net income ranging from $1.431 billion to $1.531 billion and an adjusted diluted EPS of $5.64 to $5.96. They project a 5% organic revenue growth at the midpoint for the year, a full-year adjusted tax rate between 23% and 25%, and capital expenditures between 4.1% and 4.5% of revenues. The company also plans a stronger focus on share repurchases versus debt reduction, maintaining disciplined expense management, and leveraging scale to enhance operational efficiency and productivity.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.