Company Reports

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C Technologies reported a respectable quarter. Organic revenue grew 6.4% in the second quarter of 2024, compare with 4.7% in the first quarter and the firm's outlook of 4.8% at the midpoint. In addition, revenue retention remains steady in the 96%-97% range. However, while SS&C beat its second-quarter outlook by about $20 million at the midpoint, it only raised its full-year outlook revenue by $12 million at the midpoint in part due to some accelerated license revenue in the quarter. SS&C raised its adjusted earnings per share outlook by $0.05 at the midpoint to $5.10. Overall, there was little in the firm's financial results that would alter our long-term view of the firm, and we will maintain our narrow moat rating and $82 fair value estimate. We regard shares as undervalued.

SS&C Technologies is off to a steady start in 2024. Organic revenues grew 4.7% in the first quarter of 2024, which compares with 4.5% in the fourth quarter and the firm's outlook of 2%-5%. In addition, revenue retention continues to hold steady in the 96%-97% range. SS&C's full-year 2024 revenue outlook was essentially unchanged at the midpoint, and the firm raised its adjusted EPS outlook by 1% at the midpoint. Overall, there was little in the firm's financial results that would alter our long-term view of the firm, and we will maintain our narrow moat rating and $82 fair value estimate. We regard shares as undervalued.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C reported a solid finish to 2023 and a decent revenue outlook for 2024. Revenue of $1.41 billion was in line with the FactSet consensus estimate, while adjusted EBITDA of $563 million and adjusted EPS of $1.26 beat by 2%. Revenue retention continues to be steady. Overall, there was little in the firm’s financial results that would alter our long-term view of the firm. We will maintain our narrow moat rating and $81 fair value estimate and regard shares as undervalued.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C reported a third quarter that was a tad soft on revenue. Revenues, adjusted EBITDA, and adjusted EPS of $1.37 billion, $534 million, $1.17, respectively, compared with the FactSet consensus estimates of $1.38 billion, $532 million, and $1.18. Overall, there was little in the firm's third-quarter earnings release that would alter our long-term view of the firm, and we will maintain our narrow moat rating and fair value estimate of $75 per share.

Similar to the first quarter of 2023, narrow-moat-rated SS&C's second-quarter revenue was in line with expectations, but operating margins were showing some softness. Revenue of $1.36 billion (with 2.5% organic growth) was in line with the FactSet consensus estimate, while adjusted EBITDA of $502 million was 2% below the consensus estimate of $513 million. Looking ahead, while SS&C expects organic growth to accelerate to about 5% by the fourth quarter, management reduced its full-year estimate by 1% to 3% at the midpoint. After increasing our expense forecasts, we have lowered our fair value estimate to $75 per share from $78.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C Technologies started 2023 on decent footing. First-quarter revenue of $1.36 billion, adjusted EBITDA of $509 million, and adjusted EPS of $1.11 compared with the FactSet consensus estimates of $1.35 billion, $518 million, and $1.14, respectively. Overall, there was little that would alter our long-term view of the firm, and we will maintain our $77 fair value estimate. We regard the shares as undervalued.

Narrow-moat SS&C finished 2022 with an okay fourth quarter. Organic constant currency revenue growth was flat, consistent with management’s guidance and consensus expectations amid a deteriorating macroenvironment and weakness in the healthcare business. Importantly, revenue retention finished the year at 96.3%, up from 95.6%. We view SS&C’s high retention as evidence that its solutions have meaningful switching costs. As we update our model, we are increasing our fair value estimate to $77 from $75 primarily due to time value of money. Based on SS&C’s closing price of about $62, shares are trading at 13 times our 2023 adjusted EPS estimate or 15 times our adjusted EPS estimate, which removes exclusions such as stock-based compensation and organic amortization that we do not agree with. SS&C’s business has many positive attributes, such as moderate cyclical exposure and high retention. We note that this is considerably less than the S&P 500 index forward multiple of 18.7 times and regard shares as undervalued.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to mostly financial-services firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C Technologies reported third-quarter results a bit below expectations. Revenue of $1.32 billion fell shy of the FactSet consensus estimate of $1.35 billion and management’s midpoint guidance provided in July of $1.34 billion. Adjusted EPS of $1.15 and adjusted EBTIDA of $502 million missed the consensus estimates of $1.20 and $510 million, respectively. We attribute the miss to macroeconomic conditions, particularly lower asset values for fund administration, but we believe the firm’s solutions are sticky. We view SS&C as having a narrow moat due to switching costs and note that the firm’s retention rate of 96.5% in the quarter came in slightly above 2020 and 2021 levels. We maintain our $75 fair value estimate and view the shares as attractive.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to financial-services and healthcare firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

Narrow-moat SS&C reported second-quarter results showing broad-based revenue growth deceleration, particularly from its DST businesses, which it acquired in 2018. Second-quarter revenue of $1.33 billion and adjusted EPS of $1.10 fell below the FactSet consensus of $1.35 billion and $1.18, respectively. As we incorporate revenue and expense headwinds, we expect to lower our fair value estimate of $83 in a range of 5%-15%.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to financial-services and healthcare firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C reported first-quarter results mostly in line with consensus expectations. After accounting for the inclusion of Blue Prism, revenue of $1.30 billion and adjusted EPS of $1.25 were essentially in line with the FactSet consensus. SS&C kept its 2022 midpoint organic revenue guidance at 4%, but lowered its earnings per share outlook. As we take into account higher interest rates on its debt, we expect to lower our fair value estimate of $85 by a single-digit percentage.

Founded in 1986, SS&C Technologies provides software products and software-enabled services to financial-services and healthcare firms. SS&C, which stands for Securities Software and Consultants, introduced CAMRA, or complete asset management, reporting, and accounting, in 1989. Since inception, SS&C has acquired more than 50 companies, and acquisitions have been a big part of the firm’s growth strategy.

SS&C finished 2021 with a good fourth quarter. Revenue for the quarter of $1.30 billion and adjusted EPS of $1.28 topped the FactSet consensus of $1.26 billion and $1.23, respectively. The firm’s initial 2022 outlook was mostly in line with consensus estimates. Overall, there was little in the firm’s financial results that would alter our long-term view of the firm. We will maintain our narrow moat rating and fair value estimate of $85.