Park City Group, Inc. revenue jumped on 16.4% while EBITDA Margin decreased on 4.3 pp from 23.2% to 18.8%
09/13/2018 • About Park City Group, Inc. (
$PCYG) • By InTwits
Park City Group, Inc. reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Park City Group, Inc. is a growth stock: FY2018 revenue growth was 16.4%, 5 year revenue CAGR was 14.3% at FY2018 ROIC 8.2%
- EBITDA Margin is quite volatile: 18.8% in FY2018, 23.2% in FY2017, 8.5% in FY2016, -24.4% in FY2015, -14.4% in FY2014
- Park City Group, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.7%. At the same time it's a lot of higher than industry average of 3.1%.
- CAPEX is quite volatile: $0m in FY2018, $2m in FY2017, $0m in FY2016, $0m in FY2015, $0m in FY2014
- The company has business model with low profitability: ROIC is 8.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Park City Group, Inc.'s Revenue surged on 16.4%. Revenue growth showed acceleration in FY18Q4 - it increased 21.8% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.4 pp from 1.1% to 2.5% in 2018.
Gross Margin decreased slightly on 1.8 pp from 71.9% to 70.1% in FY2018. Gross Margin stuck to a growing trend at 3.6 pp per annum in FY2014-FY2018. SG&A as a % of Revenue increased on 2.5 pp from 48.8% to 51.3% in FY2018. SG&A as a % of Revenue followed a declining trend at -6.7 pp per annum in FY2014-FY2018.
Net Income margin decreased on 4.5 pp from 19.9% to 15.5% in FY2018. Net Income margin followed a growing trend at 12.1 pp per annum in FY2014-FY2018.
Investments (CAPEX, working capital and M&A)
In FY2018 the company had CAPEX/Revenue of 0.93%. The company's CAPEX/Revenue decreased slightly on 1.8 pp from 2.7% in FY2015 to 0.93% in FY2018. It's average level of CAPEX/Revenue for the last three years was 3.9%.
Return on investment
The company operates at low ROIC (8.2%) and ROE (7.5%). ROIC decreased on 2.2 pp from 10.4% to 8.2% in FY2018. ROE decreased slightly on 1.5 pp from 9.0% to 7.5% in FY2018. ROIC followed a growing trend at 8.7 pp per annum in the last 5 years. ROE grew at 11.8 pp per annum in the last 5 years.
Leverage (Debt)
Company's Net Debt / EBITDA is -2.4x and Debt / EBITDA is 1.2x. Debt decreased on 3.0% while cash increased on 6.0%.
Park City Group, Inc. has no short term refinancing risk: cash is higher than short term debt (435.6%).
Valuation and dividends
Park City Group, Inc.'s trades at EV/EBITDA 41.1x and P/E 53.0x.
Management team
Randall K Fields "Randy" is a Park City Group, Inc.'s CEO. Randall K Fields "Randy" is a founder and has spent 17 years with the company. John R Merrill is a the company's CFO. John R Merrill has spent 9 years at the company.
Financial and operational results
FY ended 06/30/2018
Park City Group, Inc. ($PCYG) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 11.928 | 13.649 | 14.011 | 18.939 | 22.036 | 16.4% |
| Gross Profit | 6.840 | 8.392 | 9.731 | 13.621 | 15.449 | 13.4% |
| SG&A | 8.554 | 10.221 | 8.536 | 9.234 | 11.298 | 22.4% |
| EBITDA | -1.713 | -3.324 | 1.195 | 4.387 | 4.151 | -5.4% |
| Net Income | -2.490 | -3.850 | 0.667 | 3.778 | 3.409 | -9.8% |
Balance Sheet
|
|---|
| Cash | 3.353 | 11.326 | 11.443 | 14.054 | 14.892 | 6.0% |
| Short Term Debt | 1.427 | 2.727 | 2.739 | 3.169 | 3.418 | 7.9% |
| Long Term Debt | 0.422 | 0.349 | 0.491 | 1.997 | 1.592 | -20.3% |
Cash flow
|
|---|
| Capex | 0.459 | 0.370 | 0.081 | 1.957 | 0.204 | -89.6% |
Ratios
|
|---|
| Revenue growth | 5.4% | 14.4% | 2.7% | 35.2% | 16.4% | |
| EBITDA growth | -231.8% | 94.0% | -135.9% | 267.2% | -5.4% | |
|
|---|
| Gross Margin | 57.3% | 61.5% | 69.5% | 71.9% | 70.1% | -1.8% |
| EBITDA Margin | -14.4% | -24.4% | 8.5% | 23.2% | 18.8% | -4.3% |
| SG&A, % of revenue | 71.7% | 74.9% | 60.9% | 48.8% | 51.3% | 2.5% |
| Net Income Margin | -20.9% | -28.2% | 4.8% | 19.9% | 15.5% | -4.5% |
| CAPEX, % of revenue | 3.8% | 2.7% | 0.6% | 10.3% | 0.9% | -9.4% |
|
|---|
| ROIC | -20.7% | -18.9% | 2.1% | 10.4% | 8.2% | -2.2% |
| ROE | -29.8% | -34.4% | -0.2% | 9.0% | 7.5% | -1.5% |
| Net Debt/EBITDA | | | -6.9x | -2.0x | -2.4x | -0.4x |
Park City Group, Inc. ($PCYG) key quoterly financial indicators
| mln. $ | FY18Q1 | FY18Q2 | FY18Q3 | FY18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 5 | 6 | 5 | 6 | | 11.8% | 19.6% | 11.2% | 21.8% |
| EBITDA | 1 | 2 | 1 | 1 | | -28.1% | 2.6% | -42.3% | 37.6% |
| Net Income | 0 | 1 | 0 | 1 | | -46.2% | -2.0% | -49.3% | 43.8% |
Balance Sheet
|
|---|
| Cash | 15 | 15 | 15 | 15 | | 30.7% | 22.8% | 9.5% | 6.0% |
| Short Term Debt | 3 | 3 | 3 | 3 | | 15.6% | 5.4% | 21.4% | 7.9% |
| Long Term Debt | 2 | 2 | 2 | 2 | | 348.2% | 388.2% | 192.8% | -20.3% |
Ratios
|
|---|
| Gross Margin | 69.9% | 75.1% | 65.8% | 69.3% | | -1.5% | -0.0% | -5.9% | -0.2% |
| EBITDA Margin | 12.1% | 26.9% | 11.5% | 22.7% | | -6.7% | -4.5% | -10.6% | 2.6% |
| Net Income Margin | 7.0% | 23.6% | 8.7% | 20.1% | | -7.6% | -5.2% | -10.3% | 3.1% |
Peers in Application Software
Below we provide Park City Group, Inc. benchmarking against other companies in Application Software industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| nFusz Inc ($FUSZ) | | | | | 433.3% |
| CloudCommerce Inc ($CLWD) | | -38.1% | 247.6% | 40.9% | 301.1% |
| Seven Stars Cloud Group, Inc. ($SSC) | | 134.7% | 663.8% | 310.3% | 161.7% |
| Aurora Mobile Limited ($JG) | | | | 304.9% | 150.8% |
| Intelligent Systems Corporation ($INS) | | 14.2% | 71.0% | 12.2% | 119.0% |
| |
|---|
| Median (150 companies) | 27.9% | 13.5% | 14.3% | 14.8% | 15.2% |
|---|
| Park City Group, Inc. ($PCYG) | | 14.4% | 2.7% | 35.2% | 16.4% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Skkynet Cloud Systems Inc ($SKKY) | 99.7% | 97.4% | 98.0% | 97.6% | 96.5% |
| hopTo Inc ($HPTO) | 91.8% | 87.8% | 95.9% | 98.2% | 95.4% |
| Aware, Inc. ($AWRE) | 75.4% | 87.2% | 90.3% | 94.6% | 92.3% |
| Alteryx, Inc. ($AYX) | 77.5% | 80.5% | 81.3% | 83.4% | 91.0% |
| Aspen Technology, Inc. ($AZPN) | 86.5% | 88.7% | 89.7% | 90.2% | 89.9% |
| |
|---|
| Median (149 companies) | 63.4% | 61.9% | 63.8% | 64.4% | 65.3% |
|---|
| Park City Group, Inc. ($PCYG) | 57.3% | 61.5% | 69.5% | 71.9% | 70.1% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Aspen Technology, Inc. ($AZPN) | 34.5% | 42.2% | 46.0% | 45.2% | 43.3% |
| ANSYS, Inc. ($ANSS) | 45.9% | 45.8% | 45.1% | 41.9% | 41.4% |
| Paycom Software, Inc. ($PAYC) | 15.1% | 19.5% | 35.1% | 34.4% | 35.9% |
| j2 Global, Inc. ($JCOM) | 41.6% | 40.6% | 41.7% | 36.5% | 35.7% |
| Adobe Inc. ($ADBE) | 17.5% | 25.9% | 31.2% | 34.2% | 35.3% |
| |
|---|
| Median (151 companies) | -10.1% | -9.4% | -5.3% | -4.2% | -3.3% |
|---|
| Park City Group, Inc. ($PCYG) | -14.4% | -24.4% | 8.5% | 23.2% | 18.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| TimefireVR Inc ($TFVR) | 0.0% | 350.5% | 4.3% | | 1,021.9% |
| MGT Capital Investments Inc ($MGTI) | 0.0% | 36.5% | 221.4% | 129.8% | 344.5% |
| Integrated Ventures Inc ($INTV) | | | | | 199.9% |
| ShotSpotter, Inc. ($SSTI) | | 18.3% | 28.9% | 27.1% | 24.3% |
| Ellie Mae, Inc. ($ELLI) | 12.3% | 20.6% | 16.7% | 21.1% | 19.4% |
| |
|---|
| Median (152 companies) | 2.8% | 2.7% | 3.0% | 2.3% | 2.4% |
|---|
| Park City Group, Inc. ($PCYG) | 3.8% | 2.7% | 0.6% | 10.3% | 0.9% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| InsPro Technologies Corp ($ITCC) | -558.9% | | | | 127.4% |
| Manhattan Associates, Inc. ($MANH) | 64.8% | 78.7% | 99.3% | 102.5% | 80.9% |
| Intuit Inc. ($INTU) | 34.2% | 23.7% | 52.1% | 72.6% | 66.8% |
| Aspen Technology, Inc. ($AZPN) | 133.4% | | | | 58.1% |
| Paycom Software, Inc. ($PAYC) | 16.7% | 30.5% | 75.4% | 51.1% | 47.5% |
| |
|---|
| Median (178 companies) | -14.2% | -11.2% | -9.8% | -11.8% | -9.8% |
|---|
| Park City Group, Inc. ($PCYG) | -20.7% | -18.9% | 2.1% | 10.4% | 8.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Upland Software, Inc. ($UPLD) | | | 16.4x | 115.6x | 16.7x |
| Nuance Communications, Inc. ($NUAN) | 7.9x | 5.7x | 5.3x | 7.1x | 15.2x |
| Asure Software Inc ($ASUR) | 3.4x | 4.5x | 3.6x | 9.5x | 14.5x |
| SS&C Technologies Holdings, Inc. ($SSNC) | 1.7x | 7.3x | 4.6x | 3.1x | 8.5x |
| Avaya Holdings Corp. ($AVYA) | | | | | 7.4x |
| |
|---|
| Median (69 companies) | -1.4x | -1.0x | -0.9x | -0.8x | -0.6x |
|---|
| Park City Group, Inc. ($PCYG) | | | -6.9x | -2.0x | -2.4x |
