Investment Thesis
PTC demonstrates exceptional financial health with robust revenue growth of 19.2% YoY coupled with extraordinary net income growth of 95%, indicating significant operational leverage and improving profitability. The company generates substantial free cash flow of $267.4M (39% FCF margin) with minimal debt burden (0.31x D/E ratio), providing financial flexibility for reinvestment or shareholder returns.
PTC Strengths
- Exceptional net income growth of 95% YoY significantly outpacing revenue growth of 19.2%, demonstrating strong operational leverage
- Industry-leading margins with 82.8% gross margin, 32.2% operating margin, and 24.3% net margin reflecting strong pricing power and efficient operations
- Excellent free cash flow generation at $267.4M (39% FCF margin) with minimal capital intensity ($2.3M capex)
- Conservative leverage with 0.31x debt-to-equity ratio and 12.8x interest coverage ratio providing substantial financial flexibility
- Strong liquidity position with 1.22x current and quick ratios supporting operational needs
PTC Risks
- Low ROE of 4.3% and ROA of 2.6% suggest inefficient capital deployment relative to equity and asset base, despite strong absolute profitability
- Significant insider selling activity with 16 Form 4 filings in last 90 days may indicate insider concern about valuation or business trajectory
- Modest current and quick ratios (1.22x) indicate tighter working capital management that could be challenged by operational disruptions
- Growth deceleration risk if the 19.2% revenue growth momentum cannot be sustained in competitive software markets
Key Metrics to Watch
- Revenue growth rate trend - sustainability of 19.2% YoY growth in coming quarters
- Net income margin progression - whether 24.3% margin can be maintained or expanded
- Free cash flow consistency and deployment - allocation decisions for capital deployment
- Debt levels and interest coverage - management of the $1.2B long-term debt position
- Return on equity improvement - ability to generate better returns on the $3.8B equity base
PTC Financial Metrics
PTC Profitability Ratios
PTC Balance Sheet & Liquidity
PTC 5-Year Financial Trend
5-Year Trend Summary: PTC INC.'s revenue has grown significantly by 52% over the 5-year period, indicating strong business expansion. The most recent EPS of $2.06 reflects profitable operations.
PTC Growth Metrics (YoY)
PTC Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $565.1M | $82.2M | $0.68 |
| Q3 2025 | $518.6M | $69.0M | $0.57 |
| Q2 2025 | $603.1M | $114.4M | $0.95 |
| Q1 2025 | $550.2M | $66.4M | $0.55 |
| Q3 2024 | $518.6M | $61.4M | $0.51 |
| Q2 2024 | $542.2M | $63.5M | $0.53 |
| Q1 2024 | $465.9M | $66.4M | $0.55 |
| Q3 2023 | $462.5M | $61.4M | $0.51 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
PTC Capital Allocation
PTC SEC Filings
Access official SEC EDGAR filings for PTC INC. (CIK: 0000857005)