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Pegasystems (PEGA) Stock Fundamentals, Analysis & Risk Signals

Health score, competitive moat, risk signals, and key metrics at a glance.

NasdaqGS•Technology•Software - Application
B
GoodMetricSide Score: 74/100
ProfitabilityProfit20/30
GrowthGrowth17/25
Balance SheetBalance17/25
Cash QualityCash20/20
Price & Volume
Market Cap $5.24B

Pegasystems Inc. develops, markets, licenses, hosts, and supports enterprise software in the United States, rest of the Americas, the United Kingdom, rest of Europe, the Middle East, Africa, and the Asia-Pacific. It provides Pega Infinity, a software portfolio comprising of Pega Customer Decision Hub, a real-time AI-powered decision engine, which can predict a customer's behavior and recommend the next best action to take across channels in real-time; Pega Customer Service to anticipate customer needs, connect customers to people and systems, and automate customer interactions to evolve the customer service experience, as well as to allow enterprises to deliver interactions across channels and enhance employee productivity; and Pega Platform, a software for AI-powered workflow automation for increasing the efficiency of clients' processes and operational workflows. The company also offers Situational Layer Cake that organizes logic into layers that map to the unique dimensions of a client's business, such as customer types, lines of business, geographies, etc.; Pega GenAI Blueprint to rapidly prototype and accelerate the development and deployment of applications; Pega Cloud that allows clients to develop, test, and deploy applications; Pega Catalyst, which helps clients to transform and prototype their customer journeys; Pega Academy, which offers enablement content for Pega product implementations, such as instructor-led and online training to its employees, clients, and partners; and global service assurance and client support services. It primarily markets its software and services to financial services, healthcare, communications and media, government, insurance, manufacturing and high tech, and consumer industries through a direct sales force, as well as partnerships with technology providers and application developers. Pegasystems Inc. was incorporated in 1983 and is headquartered in Waltham, Massachusetts.

Moat Signals

Competitive analysis based on 60 quarters of fundamental data

Pricing Power

Weak Moat

Operating margins are under pressure, averaging 11.7%. The business may lack pricing power or face rising costs.'

Competitive Advantage

Strong Moat

Consistently high ROE averaging 35.6% suggests a durable competitive advantage and efficient capital allocation.

Cash Generation

Strong Moat

Free cash flow is consistently positive and growing — a hallmark of a capital-light business that can self-fund growth.

Demand Durability

Moderate Moat

Revenue shows resilience with 5 of 7 quarters posting growth — demand is generally stable but has seen some soft patches.

Risk Signals

Data-driven red flags and warnings across 60 quarters

Some Concerns

Margin Pressure

Red Flag

Operating margins dropped 32.7% over recent quarters — a sharp decline suggesting serious cost or pricing challenges.

Earnings Quality

Healthy

FCF covers net income by 2.3x on average — earnings are well-supported by cash generation.

Leverage Risk

Healthy

Limited debt-to-equity data available.

Revenue Decline

Healthy

Revenue is stable or growing over recent quarters — demand appears durable.

Cash Burn

Healthy

Free cash flow is consistently positive — the business self-funds without external capital reliance.

Share Dilution

Healthy

Share count is stable — no significant dilution or buyback activity.

Metrics at a Glance

as of March 2026

Revenue & Profit

Revenue, EBITDA, operating income, net income, EPS, and shares

TTM Revenue
$1.70B
3.5%
Q. Revenue
$429.97M
TTM EBITDA
$186.75M
35.1%
TTM Op. Income
$173.26M
36.1%
Q. Op. Income
$37.15M
TTM Net Income
$340.78M
73.2%
Q. Net Income
$32.76M
EPS
$0.19
Shares Out.
$168.82M
1.7%
$1.70B in TTM revenue grew 3.5% YoY, reaching $429.97M last quarter. TTM EBITDA of $186.75M and TTM operating income of $173.26M shows growth is flowing through. Net income of $340.78M TTM confirms the company is converting revenue into profit. Revenue is growing modestly — monitor for acceleration or deceleration.

Margins

Gross, EBITDA, operating, and net margin trends

Gross Margin
75.2%
4.2%
EBITDA Margin
9.3%
Op. Margin
8.6%
67.6%
Net Margin
7.6%
57.6%
Op. margin of 8.6% is down 18.1% YoY — costs are rising relative to revenue. Net margin at 7.6% and gross margin of 75.2% — earnings take a bigger bite when COGS stays lean..

Price Ratios

P/E, P/S, P/B, EV/EBITDA, FCF yield, and earnings yield

P/E Ratio
15.4x
P/S Ratio
3.1x
P/B Ratio
7.4x
At 15.4x P/E, the stock trades in line with market averages — fairly valued. P/S of 3.1x and P/B of 7.4x provide additional context. Assess whether the current multiple is justified by the company's growth and profitability trajectory.

Assets & Liabilities

Total assets, cash, debt, book value, and leverage

Total Assets
$1.55B
Cash
$269.96M
Long-Term Debt
N/A
Book Value
$705.91M
D/E Ratio
N/A
Debt/EBITDA
0.0

Cash Flow

Operating cash flow, free cash flow, FCF margin, and earnings quality

Op. Cash Flow
$212.25M
Free Cash Flow
$206.53M
2.1%
FCF Margin
12.1%
FCF / Net Income
6.3
FCF of $206.53M on $212.25M in operating cash flow. The FCF / Net Income ratio of 0.6x indicates partial cash conversion — earnings quality needs attention.

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