1Y Target$195.09Near-term target
5Y Target$377.89Compound horizon
10Y Target$983.33Long-dated conviction
FCF$899mTTM · 03/26C+FCF $899m — respectable but not differentiating · TTM computed from 4 most-recent quarters (TTM · 03/26).
Rev+20.0%TTM YoYA-Revenue +20.0% — strong growth, well above S&P median (~7%)
D/E0.14A-D/E 0.14 — conservative leverage, strong balance sheet
P/S5.4xBP/S 5.4x — in line with software/tech peers
PEG0.35APEG 0.35 — exceptional; paying well under fair value for growth
Why now
Software - Infrastructure · market cap $28.5b. 8% off the 52-week high of $203.71. Revenue growing +20%, comfortably above the S&P median. PEG 0.35 — paying under fair value for the growth rate. 28 sell-side analysts rate this a Buy with a mean 1-yr target of $195.09 (implying +4% upside).
Moat
FCF converts 865% of net income — earnings translate cleanly into cash, a sign that working capital and capex are well-disciplined. Software economics — recurring revenue, embedded customer workflows, and high gross margin all compound the moat once a base account is won. Switching costs are the lever.
Risk
Net margin 2.0% is thin — operating leverage cuts both ways; input-cost inflation or pricing pressure hits the bottom line first. ROE 1% is below the long-run sustainable threshold of ~10% — capital efficiency would need to improve for the equity base to compound at the market rate. SaaS displacement — recurring revenue is sticky in good times but accelerates in churn during a downturn as customers consolidate vendors and renegotiate seat counts.
Horizon
1-3 yr $195.09 (28-analyst consensus) — catalyst-driven; binary events dominate. 5 yr $377.89 — requires the platform / technology to reach commercial scale. 10 yr $983.33 — return distribution heavily skewed.
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