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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
American Software, Inc. (XNAS:AMSWA) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AMSWA
Name:
AMERICAN SOFTWARE, INC. (XNAS:AMSWA)
Sector:
2.73M
Industry:
Software�Application
CEO:
Mr. H. Allan Dow
Total Employees:
418
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -101.43% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AMERICAN SOFTWARE, INC.(AMSWA) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SOFTWARE�APPLICATION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
16.34
One Month Price Target:
$16.42
Six Month Price Target :
$16.81
Likely Price in One Year's Time:
Ticker:
$17.28
Likely Trading Range Today Under (Normal Volatility)
$16.26
Price Upper limit ($) :
$16.44
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$15.22
This week:
$13.85
This month :
$11.35
Other Primary facts
Market Cap:
546.56M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
33.70M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
39.06%
-27.52%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$21.52
$19.14
$11.16
$13.54
Medium risk (<10%) entry points
Buy Call
Sell Call
$18.37
Buy Put:
Sell Put:
$17.86
$14.31
$14.82
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AMSWA
Sharpe Ratio:
1.59%
Comparison:
AMSWA, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is 64.55% higher than the industry
& is -30.41% lower than the market/S&P 500 average
Average Returns/Yield of
AMSWA
Daily returns:
0.06%
Weekly returns:
0.31%
Monthly returns:
1.24%
Yearly returns:
9.94%
Comparison of returns:
Average annual returns/yield (last 3 years) is 49.88% above industry average
Classification:
AMSWA, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
1
Statistical test of Returns:
AMSWA has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.35%
Weekly Volatility:
7.50%
Monthly Volatility:
15.00%
Yearly Volatility:
51.97%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
2.89%
Volatility in last five trading days has been -13.85% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.83%
Weekly VaR:
-15.27%
Monthly VaR:
-30.53%
How Much Can the price of
AMSWA
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$12.04
This translates to price declining to:
$2.45
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AMSWA is a 115.51% riskier investment compared to the market/S&P 500 & is 84.63% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -6.67% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AMSWA
Beta in relation to market/S&P 500--0.86
Expected beta in 1 year's time:
0.623
Expected beta in 3 year's time:
0.881
Unlevered (debt free) Beta:
0.851
Beta in relation to Nasdaq (XNAS):
0.516
Beta in relation to all global stocks::
0.809
Beta Comparison & Analysis
Beta of competitors/peers::
1.823
Beta is -53.07% lower than peers
Average Industry Beta:
1.335
Beta is -35.95% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.059
Alpha is -349.24% below industry average alpha yield
Alpha is 375% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AMSWA
Equity cost of capital:
0.090
Equity cost of capital is -26.74% below industry mean WACC
Unlevered (without debt) cost of capital:
8.97%
Before-tax cost of debt:
-
After-tax cost of debt:
-
Overall debt rating:
-
Weighted average cost of capital (WACC):
-
-
Key Per-Share Metrics & Analysis
Revenue per share:
$3.79
Revenue growth rate per share of (3Y):
4.35
Annual revenue growth rate is -107.18% below industry average
EPS:
$0.37
Expected Annual growth rate of EPS (3Y):
16.74%
Expected future EPS growth rate is -38.81% lower than the Software�Application industry
Free cash flow (FCF) per share:
$0.83
Balance sheet equity growth per share: 0.25%
Equity growth rate per share is -83.45% lower than the industry
Debt per share
$0.02
EBITDA per share
$0.53
Valuation Analysis Today of
AMSWA
P/E Ratio:
47.34
P/E Ratio of Competitors/Peers:
97.54
P/E ratio is -51.47% lower than main peers & is -73.35% lower than the industry
Stock price/value with industry average P/E ratio: $65.71
AMSWA is -75.13% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $22.85
Present value of the expected future dividends only: $4.88
P/S (Price to Sales ratio):
4.32
Price to sales ratio is -62.37% below the industry mean
P/B (Price to book value ratio):
4.35
Price to free cash flow: 19.68
Price to free cash flow ratio is -57.82% lower than the industry
Net income growth rate (3Y):
-38.00%
Net income growth rate is -115.56% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 28.23%
Dividend yeild: 2.69%
Previous Dividend: $0.11
Previous adjusted dividend: $0.11
Previous Dividend: $0.44
-
-
Average dividend payment (long-term): $0.11
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 18/08/2022
Expected next dividend record date: 08/04/2022
Expected next dividend declaration date: 17/05/2022
Previous dividend payment date: 20/05/2022
Previous dividend record date: 05/06/2022
Previous dividend declaration date: 16/02/2022
Dividend History:
2022-05-05--$0.11
2021-11-18--$0.11
2021-05-06--$0.11
2022-02-03--$0.11
2021-08-12--$0.11
2021-02-04--$0.11
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
0.53%
Net debt to equity ratio:
-71.51%
Debt to assets ratio:
0.38%
Net debt to assets ratio:
-50.42%
Debt-to-asset ratio is -99.32% below industry average
Ability to repay debt:
Interest coverage ratio:
-
-
Looking forward:
Debt growth rate:
0.00%
-
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.31
Statistical significance of correlation:
AMSWA has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.503
Stock price is -38.40% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.503
Correlation of price movement with Nasdaq (^IXIC):
-0.029
Covariance of price movement with the market:
-0.056
Kurtosis
38.536
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
1.746
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
AMSWA
Gross Profit Margin Ratio:
237%
Operating Profit Margin Ratio:
10.31%
Operating profit margin is -153.83% lower than the industry
Net Profit Margin Ratio:
237%
Effective Tax Rate:
7.62%
Effective tax rate is -71.09% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.10%
Return on equity (ROE) is -177.24% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
7.12%
Return on assets (ROA) is -285.45% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
2.85
Current ratio is -4.90% below industry average
Cash Conversion Cycle (days):
-31
Cash conversion cycle is -132.75% below industry average
The remaining useful life of property plant & equipment is: 33.7 years
Stock based compensation to net income ratio:
6.06%
In-depth Efficiency Analysis
Revenue generated per employee:
305.2K
Each employee generates -12% less revenue than industry average revenue per employee
EBITDA generated per employee:
43.0K
Each employee generates 300% more EBITDA than industry average revenue per employee
Profit generated per employee:
30.6K
Each employee generates -275% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
6.5K
Each employee generates -184% less free cash flow than industry average revenue per employee
Assets/Capital per employee
94.5K
Each employee generates -184% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 10.53%
Growth rate in R&D investment/expenditure is 588.68% higher than the industry
Competitors/Peer firms of
AMSWA
RIMINI STREET, INC. (XNAS:RMNI)
CLEANSPARK, INC. (XNAS:CLSK)
VERITONE, INC. (XNAS:VERI)
EBANG INTERNATIONAL HOLDINGS INC. (XNAS:EBON)
MITEK SYSTEMS, INC. (XNAS:MITK)
ALPHA AND OMEGA SEMICONDUCTOR LIMITED (XNAS:AOSL)
ABSOLUTE SOFTWARE CORPORATION (XNAS:ABST)
UNIVERSAL ELECTRONICS INC. (XNAS:UEIC)
KOPIN CORPORATION (XNAS:KOPN)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
127.55M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
51.76M
75.80M
17.60M
21.96M
44.83M
22.87M
212.00K
62.64M
391.00K
-
4.14M
17.98M
13.16M
12.78M
13.84M
1.06M
12.78M
Statement of Cash Flow
Date:
Period:
1.13M
Differed Income Tax :
- 25.00K
Stock Based Compensation :
775.00K
Change in Working Capital :
- 1520.00K
Accounts Receivables:
1.77M
Other Working Capital:
- 221.00K
Other Non-Cash Items:
- 274.00K
Net Cash Provided by Operating Activities:
3.03M
Investments in PP&E:
- 302.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
7/31/21
2022
Q1
91.85M
16.28M
108.13M
24.87M
-
6.96M
139.96M
4.83M
25.89M
4.17M
-
-
4.61M
39.49M
-
179.46M
2.03M
693.00K
-
36.92M
9.49M
49.13M
674.00K
514.00K
3.79M
-
52.92M
3.79M
- 15991.00K
-
138.74M
July 31, 2021 at 6:00:00 AM
114.40M
126.53M
179.46M
-
1.37M
- 90487.0K
-
-
- 302.00K
-
-
-
- 3608.00K
4.07M
464.00K
-
3.20M
91.85M
88.66M
3.03M
- 302.00K
2.73M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
AMSWA
2023
2024
2025
2026
2027
$17.37
$27.96
$29.57
$31.27
$33.07