Latest Ratios: P/E Ratio 14.7x · EV/EBITDA 17.8x · ROE 57.3%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $5.3B | $11.0B | $8.4B | $4.1B | $2.8B | $9.1B | $10.7B | $6.3B | $4.0B | $3.9B | $2.9B |
| Enterprise Value | $5.2B | $10.9B | $8.6B | $4.5B | $3.3B | $9.6B | $11.1B | $6.3B | $3.9B | $3.7B | $2.8B |
| P/E Ratio → | 14.69 | 28.04 | 84.73 | 61.07 | — | — | — | — | 374.33 | 39.64 | 105.88 |
| P/S Ratio | 3.03 | 6.32 | 5.58 | 2.90 | 2.13 | 7.51 | 10.52 | 6.91 | 4.46 | 4.65 | 3.83 |
| P/B Ratio | 7.34 | 14.02 | 14.27 | 11.73 | 21.44 | 21.87 | 19.75 | 11.68 | 6.39 | 10.53 | 8.55 |
| P/FCF | 10.78 | 22.49 | 24.70 | 20.64 | — | 317.52 | — | — | 42.98 | 27.03 | 138.09 |
| P/OCF | 10.47 | 21.84 | 24.15 | 19.05 | 125.62 | 232.65 | — | — | 38.08 | 24.69 | 71.99 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 6.24 | 5.72 | 3.14 | 2.54 | 7.94 | 10.94 | 6.89 | 4.33 | 4.45 | 3.73 |
| EV / EBITDA | 17.82 | 37.71 | 53.77 | 38.93 | — | — | — | — | 467.07 | 31.76 | 37.44 |
| EV / EBIT | 19.58 | 38.66 | 57.31 | 43.98 | — | — | — | — | — | 40.18 | 52.29 |
| EV / FCF | — | 22.21 | 25.33 | 22.39 | — | 335.85 | — | — | 41.74 | 25.91 | 134.69 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 75.9% | 75.9% | 73.9% | 73.6% | 72.0% | 72.2% | 69.4% | 66.0% | 66.2% | 72.4% | 69.7% |
| Operating Margin | 15.1% | 15.1% | 8.3% | 5.7% | -8.3% | -7.8% | -14.1% | -14.8% | -1.9% | 11.1% | 6.8% |
| Net Profit Margin | 22.5% | 22.5% | 6.6% | 4.7% | -26.2% | -5.2% | -6.0% | -9.9% | 1.2% | 3.9% | 3.6% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 57.3% | 57.3% | 21.1% | 28.0% | -126.4% | -13.2% | -11.4% | -15.6% | 2.1% | 9.3% | 8.2% |
| ROA | 23.1% | 23.1% | 6.0% | 4.7% | -23.4% | -3.9% | -4.7% | -9.2% | 1.2% | 4.8% | 4.2% |
| ROIC | 27.2% | 27.2% | 12.4% | 8.8% | -10.2% | -7.4% | -14.5% | -19.6% | -3.6% | 29.5% | 15.3% |
| ROCE | 33.4% | 33.4% | 15.3% | 9.2% | -11.4% | -8.4% | -16.4% | -21.4% | -3.2% | 23.9% | 13.9% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.10 | 0.10 | 0.94 | 1.64 | 5.26 | 1.65 | 1.10 | 0.10 | — | — | — |
| Debt / EBITDA | 0.26 | 0.26 | 3.45 | 5.03 | — | — | — | — | — | — | — |
| Net Debt / Equity | — | -0.17 | 0.36 | 0.99 | 4.15 | 1.26 | 0.78 | -0.03 | -0.18 | -0.44 | -0.21 |
| Net Debt / EBITDA | -0.47 | -0.47 | 1.33 | 3.04 | — | — | — | — | -13.85 | -1.38 | -0.94 |
| Debt / FCF | — | -0.28 | 0.63 | 1.75 | — | 18.34 | — | — | -1.24 | -1.12 | -3.40 |
| Interest Coverage | 219.39 | 219.39 | 21.87 | 14.88 | -19.76 | -15.59 | -5.45 | — | — | — | — |
Net cash position: cash ($212M) exceeds total debt ($76M)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.33 | 1.33 | 1.23 | 1.78 | 1.57 | 1.73 | 2.12 | 1.34 | 1.84 | 1.51 | 1.40 |
| Quick Ratio | 1.33 | 1.33 | 1.23 | 1.78 | 1.57 | 1.73 | 2.12 | 1.34 | 1.84 | 1.51 | 1.40 |
| Cash Ratio | 0.58 | 0.58 | 0.68 | 0.73 | 0.55 | 0.75 | 1.01 | 0.18 | 0.63 | 0.71 | 0.47 |
| Asset Turnover | — | 1.07 | 0.85 | 0.95 | 0.97 | 0.76 | 0.63 | 0.93 | 0.91 | 1.16 | 1.15 |
| Inventory Turnover | — | — | — | — | — | — | — | — | — | — | — |
| Days Sales Outstanding | — | 100.89 | 134.79 | 143.31 | 141.74 | 127.11 | 157.22 | 152.16 | 144.73 | 166.23 | 135.82 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 0.3% | 0.1% | 0.1% | 0.2% | 0.4% | 0.1% | 0.1% | 0.2% | 0.2% | 0.2% | 0.3% |
| Payout Ratio | 3.9% | 3.9% | 10.3% | 14.7% | — | — | — | — | 88.8% | 28.2% | 34.0% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 6.8% | 3.6% | 1.2% | 1.6% | — | — | — | — | 0.3% | 2.5% | 0.9% |
| FCF Yield | 9.3% | 4.4% | 4.0% | 4.8% | — | 0.3% | — | — | 2.3% | 3.7% | 0.7% |
| Buyback Yield | 9.8% | 4.7% | 0.9% | 0.0% | 1.7% | 1.3% | 1.0% | 1.1% | 2.3% | 1.2% | 1.5% |
| Total Shareholder Yield | 10.0% | 4.8% | 1.0% | 0.3% | 2.0% | 1.5% | 1.1% | 1.2% | 2.6% | 1.4% | 1.8% |
| Shares Outstanding | — | $185M | $179M | $170M | $164M | $163M | $161M | $158M | $166M | $166M | $159M |
Cloud transition revenue volatility
Based on current market data, PEGA trades at a forward P/E of 11.32, which appears to discount the company's long-term growth potential relative to peers like ServiceNow, suggesting investors remain skeptical of the speed at which the cloud transition will normalize earnings and drive sustained margin expansion.
The current valuation multiple suggests the market is pricing PEGA as a mature, slower-growth entity rather than a high-growth SaaS platform. This discount may be an analytical misjudgment if the company successfully leverages its AI-driven decisioning hub to capture higher-value enterprise contracts, potentially warranting a re-rating as the cloud transition matures.
As reported in financial statements, PEGA's ROIC has fluctuated significantly from a low of -2.2% in 2024Q1 to a peak of 18.1% in 2023Q4, indicating that the company's ability to compound capital is currently hampered by the lumpy nature of its legacy subscription license revenue recognition.
The inconsistency in return on invested capital suggests that the firm is still in the process of optimizing its asset base for a cloud-first model. Investors should monitor whether ROIC stabilizes above the cost of capital as the revenue mix shifts further toward ratable, predictable cloud subscriptions.
According to recent SEC filings, PEGA's DSO has remained elevated, averaging over 90 days across the last ten quarters, which highlights the inherent challenges in collecting payments from large enterprise clients during the complex, multi-year migration to a cloud-based subscription model.
The persistent length of the collection cycle suggests that Pega's customer base retains significant leverage in payment terms, which may continue to pressure cash flow conversion. Improving this metric will be essential for the company to demonstrate the operational efficiency required to justify a premium valuation.
Based on reported figures, PEGA has aggressively reduced its debt-to-equity ratio from 1.64 in 2023Q4 to a negligible 0.08 in 2026Q1, effectively insulating the balance sheet from interest rate volatility and providing management with significant flexibility to pursue organic growth or shareholder return initiatives.
This rapid deleveraging marks a fundamental shift in the company's risk profile, moving from a debt-reliant structure to one supported by internal cash generation. The current interest coverage ratio of over 900x suggests that debt service is no longer a material risk to the firm's ongoing operations.
As documented in financial statements, the P/E ratio is a misleading metric for PEGA because it fails to account for the significant distortion caused by stock-based compensation and the lumpy recognition of legacy subscription licenses, which together mask the true underlying cash-generating power of the business.
Investors should prioritize Free Cash Flow (FCF) multiples over P/E, as FCF better captures the economic reality of the cloud transition by stripping away non-cash accounting noise. Relying on P/E may lead to an inaccurate assessment of the company's profitability, especially given the persistent dilution from equity-based incentives.
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Quick answers to the most common questions about buying PEGA stock.
Pegasystems Inc.'s current P/E ratio is 14.7x. The historical average is 60.0x. This places it at the 10th percentile of its historical range.
Pegasystems Inc.'s current EV/EBITDA is 17.8x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 32.2x.
Pegasystems Inc.'s return on equity (ROE) is 57.3%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 2.4%.
Based on historical data, Pegasystems Inc. is trading at a P/E of 14.7x. This is at the 10th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Pegasystems Inc.'s current dividend yield is 0.27% with a payout ratio of 3.9%.
Pegasystems Inc. has 75.9% gross margin and 15.1% operating margin. Operating margin between 10-20% is typical for established companies.
Pegasystems Inc.'s Debt/EBITDA ratio is 0.3x, indicating low leverage. A ratio below 2x is generally considered financially healthy.