Capitalcube gives Ebix, Inc. a score of 75.
Our analysis is based on comparing Ebix, Inc. with the following peers – Guidewire Software, Inc., Ultimate Software Group, Inc., Majesco, Benefitfocus, Inc., Computer Sciences Corporation, John Wiley & Sons, Inc. Class A, Thomson Reuters Corporation, Prism Technologies Group, Inc. and salesforce.com, inc. (GWRE-US, ULTI-US, MJCO-US, BNFT-US, CSC-US, JW.A-US, TRI-US, PRZM-US and CRM-US).
Ebix, Inc. has a fundamental score of 75 and has a relative valuation of UNDERVALUED.
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- With respect to peers, relative outperformance over the last year is in contrast to the more recent underperformance.
- Ebix, Inc.’s current Price/Book of 4.29 is about median in its peer group.
- We classify EBIX-US as Harvesting because of the market’s relatively low growth expectations despite its relatively high returns.
- EBIX-US‘s relatively high profit margins are burdened by relative asset inefficiency.
- The company’s year-on-year change in revenues and earnings are better than the median among its peer group.
- EBIX-US‘s return on assets currently and over the past five years suggest that its relatively high operating returns are sustainable.
- The company’s relatively high gross and pre-tax margins suggest a differentiated product portfolio and tight control on operating costs relative to peers.
- While EBIX-US‘s revenues growth in recent years has been around the peer median, the stock’s below peer median P/E ratio suggests that the market likely sees the company’s long-term growth prospects to be fading.
- The company’s level of capital investment suggests it might be under-investing in a business with above median returns.
- EBIX-US has the financial and operating capacity to borrow quickly.
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Leverage & Liquidity
EBIX-US has the financial and operating capacity to borrow quickly.
- With debt at a relatively low 12.79% of its enterprise value compared to an overall benchmark of 25% (Note: The peer median is currently 10.94%), and a well-cushioned interest coverage level of 13.27x, EBIX-US can probably borrow quickly. We classify the company as Quick & Able in terms of its capacity to raise additional debt.
- Of the 9 chosen peers for the company, only 8 of the stocks have an outstanding debt balance. Companies with no debt include GWRE-US.
EBIX-US has maintained its Quick & Able profile from the recent year-end.
- EBIX-US‘s interest coverage is its lowest relative to the last five years and compares to a high of 90.58x in 2011.
- Though its interest coverage decreased to 13.27x from 20.22x (in 2015), its peer median remained relatively stable during this period at 3.27x.
- Interest coverage fell 7.06 points relative to peers.
- EBIX-US‘s debt-EV continues to trend downward and is now similar to its five-year average debt-EV of 12.61%.
- The decrease in its debt-EV to 12.79% from 16.65% (in 2015) was also accompanied by a decrease in its peer median during this period to 10.94% from 11.46%.
- Relative to peers, debt-EV fell 3.34 percentage points.
Access the detailed analysis for Ebix, Inc.
Key Liquidity Items
|Company||Debt/Enterprise Value (%)||Current Ratio||Interest Coverage (x)||Cash Flow To Total Debt (%)|
|Guidewire Software, Inc.||0||6.05||No interest exp||999|
|Ultimate Software Group, Inc.||0.18||1.14||61.18||1642.01|
|Computer Sciences Corporation||33.4||1.23||1.81||30.2|
|John Wiley & Sons, Inc. Class A||24.66||1.25||12.5||48.19|
|Thomson Reuters Corporation||23.19||0.72||4.73||34.93|
|Prism Technologies Group, Inc.||70.54||0.36||-18.48||-138.26|
|Best In Class||0.18||6.05||No interest exp||1642.01|
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Ebix, Inc. is a supplier of software and e-commerce solutions to the insurance industry. It provides a series of application software products for the insurance industry ranging from carrier systems, agency systems and exchanges to custom software development for all entities involved in the insurance and financial industries. Ebix was founded in 1976 and is headquartered in Atlanta, GA.
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