EPAM Systems Inc (EPAM, Financial), a prominent player in the software industry, has experienced a notable fluctuation in its stock price recently. With a current market capitalization of $17.53 billion, EPAM's stock is trading at $303.86. Over the past week, the stock has seen a slight decline of 2.64%. However, looking at a broader timeframe, EPAM has gained an impressive 12.33% over the past three months. According to GF Value, the stock is currently considered modestly undervalued at a GF Value of $418.85, a decrease from the past GF Value of $612.96, which indicated the stock was significantly undervalued. This shift in valuation reflects the dynamic nature of the market and the company's recent performance.
Understanding EPAM Systems Inc
EPAM Systems Inc is a global IT services firm that specializes in platform engineering, software development, and consulting services. With North America as its largest market, EPAM has been at the forefront of integrating new technologies such as artificial intelligence, virtual reality, and robotics into its service offerings. This focus on innovation has positioned EPAM as a key partner for companies looking to stay ahead in the digital transformation race.
EPAM's Profitability Landscape
EPAM's financial health is robust, as evidenced by its Profitability Rank of 10/10. The company's operating margin stands at 12.07%, outperforming 77.17% of its industry peers. Its return on equity (ROE) is 15.36%, return on assets (ROA) is 11.82%, and return on invested capital (ROIC) is 21.80%, each surpassing the industry averages and indicating efficient management and strong profitability. EPAM's consistent profitability over the past decade further solidifies its financial stability and attractiveness to investors.
Growth Trajectory of EPAM
EPAM's growth metrics are equally impressive, with a Growth Rank of 9/10. The company has maintained a 3-Year Revenue Growth Rate per Share of 27.00% and a 5-Year Revenue Growth Rate per Share of 24.90%, both of which are higher than the majority of its industry counterparts. Additionally, EPAM's 3-Year EPS without NRI Growth Rate is 20.00%, and its 5-Year EPS without NRI Growth Rate is a remarkable 37.60%, showcasing the company's ability to increase earnings at an impressive rate.
Investor Confidence in EPAM
EPAM's stock is held by notable investors, which is a testament to the company's potential. Steve Mandel (Trades, Portfolio) holds 850,260 shares, representing 1.47% of the company, while Andreas Halvorsen (Trades, Portfolio) owns 368,708 shares, accounting for 0.64%. Steven Cohen (Trades, Portfolio) also has a stake in EPAM with 102,514 shares, making up 0.18% of the company. The involvement of these prominent investors signals confidence in EPAM's future prospects and stability.
Competitive Positioning
When compared to its competitors, EPAM stands strong. Leidos Holdings Inc (LDOS, Financial) has a market cap of $16.52 billion, Jack Henry & Associates Inc (JKHY, Financial) is valued at $12.83 billion, and Globant SA (GLOB, Financial) at $10.17 billion. EPAM's market cap of $17.53 billion not only surpasses these competitors but also reflects its significant presence and competitive edge in the software industry.
Conclusion
In summary, EPAM Systems Inc's recent stock performance and valuation status paint a picture of a company that is both growing and profitable. The stock's 12.33% gain over the past three months, coupled with its modest undervaluation according to GF Value, suggests that the company is on a positive trajectory. EPAM's strong profitability and growth metrics, along with the confidence shown by its top shareholders, further reinforce its market position. When juxtaposed with its competitors, EPAM's market cap indicates a robust standing within the industry, making it a potentially attractive option for value investors.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
