📊 PEGA Key Takeaways
Is Pegasystems Inc. (PEGA) a Good Investment?
Pegasystems demonstrates exceptional financial health with a fortress balance sheet (zero debt, $212.4M cash), exceptional profitability (75.9% gross margin, 50% ROE), and strong free cash flow generation ($490.7M, 28.1% FCF margin). However, net income remained flat YoY despite 16.6% revenue growth, signaling operating leverage challenges and margin compression that warrant close monitoring before committing capital.
Why Buy Pegasystems Inc. Stock? PEGA Key Strengths
- Exceptional profitability metrics: 75.9% gross margin, 22.5% net margin, 50% ROE, 24.1% ROA
- Fortress balance sheet: zero long-term debt, $212.4M cash, 1.33x current ratio demonstrates financial stability
- Strong free cash flow generation: $490.7M FCF with 28.1% FCF margin indicates capital-efficient, cash-generative business model
PEGA Stock Risks: Pegasystems Inc. Investment Risks
- Net income growth flat (0% YoY) despite 16.6% revenue growth indicates margin compression and deteriorating operational leverage
- Operating margin only 15.1% despite 75.9% gross margin; 60.8 percentage point gap suggests high and growing operating expenses not scaling with revenue
- Elevated insider trading activity (38 Form 4 filings in 90 days) warrants monitoring for potential negative signals from insiders
Key Metrics to Watch
- Operating margin trend and expansion potential as revenue scales
- Operating expense growth rate relative to revenue growth to assess operational leverage
- Free cash flow sustainability and conversion rate as company matures
Pegasystems Inc. (PEGA) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 28.1% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments.
PEGA Profit Margin, ROE & Profitability Analysis
PEGA vs Technology Sector: How Pegasystems Inc. Compares
How Pegasystems Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Pegasystems Inc. Stock Overvalued? PEGA Valuation Analysis 2026
Based on fundamental analysis, Pegasystems Inc. appears fundamentally strong relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Pegasystems Inc. Balance Sheet: PEGA Debt, Cash & Liquidity
PEGA Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Pegasystems Inc.'s revenue has grown significantly by 44% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.37 reflects profitable operations.
PEGA Revenue Growth, EPS Growth & YoY Performance
PEGA Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $325.1M | $6.6M | $-0.08 |
| Q2 2025 | $351.2M | -$5.5M | $-0.03 |
| Q1 2025 | $330.1M | -$12.1M | $-0.14 |
| Q3 2024 | $325.1M | $6.6M | $-0.09 |
| Q2 2024 | $298.3M | -$5.5M | $-0.07 |
| Q1 2024 | $325.5M | -$12.1M | $-0.14 |
| Q3 2023 | $270.7M | -$379.0K | $-0.09 |
| Q2 2023 | $274.3M | -$379.0K | $-0.56 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Pegasystems Inc. Dividends, Buybacks & Capital Allocation
PEGA SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Pegasystems Inc. (CIK: 0001013857)
📋 Recent SEC Filings
| Date | Form | Document | Action |
|---|---|---|---|
| Apr 3, 2026 | 4 | xslF345X06/wk-form4_1775246547.xml | View → |
| Mar 19, 2026 | 4 | xslF345X06/wk-form4_1773950736.xml | View → |
| Mar 17, 2026 | 4 | xslF345X05/wk-form4_1773777731.xml | View → |
| Mar 13, 2026 | 4 | xslF345X05/wk-form4_1773433139.xml | View → |
| Mar 12, 2026 | 4 | xslF345X05/wk-form4_1773346028.xml | View → |
❓ Frequently Asked Questions about PEGA
What is the AI rating for PEGA?
Pegasystems Inc. (PEGA) has an AI rating of BUY with 70% confidence, based on fundamental analysis of SEC EDGAR filings.
What are PEGA's key strengths?
Claude: Exceptional profitability metrics: 75.9% gross margin, 22.5% net margin, 50% ROE, 24.1% ROA. Fortress balance sheet: zero long-term debt, $212.4M cash, 1.33x current ratio demonstrates financial stability.
What are the risks of investing in PEGA?
Claude: Net income growth flat (0% YoY) despite 16.6% revenue growth indicates margin compression and deteriorating operational leverage. Operating margin only 15.1% despite 75.9% gross margin; 60.8 percentage point gap suggests high and growing operating expenses not scaling with revenue.
What is PEGA's revenue and growth?
Pegasystems Inc. reported revenue of $1.7B.
Does PEGA pay dividends?
Pegasystems Inc. pays dividends, with $15.4M distributed to shareholders in the trailing twelve months.
Where can I find PEGA SEC filings?
Official SEC filings for Pegasystems Inc. (CIK: 0001013857) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is PEGA's EPS?
Pegasystems Inc. has a diluted EPS of $2.13.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is PEGA a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Pegasystems Inc. has a BUY rating with 70% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is PEGA stock overvalued or undervalued?
Valuation metrics for PEGA: ROE of 50.0% (sector avg: 22%), net margin of 22.5% (sector avg: 18%). Higher ROE suggests strong returns relative to peers.
Should I buy PEGA stock in 2026?
Our dual AI analysis gives Pegasystems Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is PEGA's free cash flow?
Pegasystems Inc.'s operating cash flow is $505.2M, with capital expenditures of $14.5M. FCF margin is 28.1%.
How does PEGA compare to other Technology stocks?
Vs Technology sector averages: Net margin 22.5% (avg: 18%), ROE 50.0% (avg: 22%), current ratio 1.33 (avg: 2.5).
Why is PEGA's return on equity (ROE) so high?
Pegasystems Inc. has a return on equity of 50.0%, significantly above the Technology sector average of 22%. A high ROE indicates the company is efficient at generating profits from shareholder equity. This is supported by a 22.5% net margin.