Ansys Inc (ANSS, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $367.14, Ansys Inc has witnessed a daily gain of 0.07%, marked against a three-month change of 18.54%. A thorough analysis, underlined by the GF Score, suggests that Ansys Inc is well-positioned for substantial growth in the near future.
Understanding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 9/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 9/10
- Momentum rank: 7/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With high ranks in financial strength, profitability, and growth, GuruFocus assigned Ansys Inc the GF Score of 99 out of 100, which signals the highest outperformance potential.
Company Overview: Ansys Inc
Ansys Inc is an engineering software company that provides simulation capabilities for structural, fluids, semiconductor power, embedded software, optical, and electromagnetic properties. With a market cap of $32.28 billion and sales amounting to $2.58 billion, Ansys Inc boasts an operating margin of 28.39%. The company employs over 4,000 people and serves over 50,000 customers globally, showcasing its extensive reach and influence in the industry.
Financial Strength Breakdown
According to the Financial Strength rating, Ansys Inc's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Ansys Inc stands impressively at 16.06, underscoring its strong capability to cover its interest obligations. This robust financial position resonates with the wisdom of legendary investor Benjamin Graham, who favored companies with an interest coverage ratio of at least 5.
With an Altman Z-Score of 12.74, Ansys Inc exhibits a strong defense against financial distress, highlighting its robust financial stability. With a favorable Debt-to-Revenue ratio of 0.32, Ansys Inc's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows Ansys Inc's impressive standing among its peers in generating profit. Furthermore, Ansys Inc's Gross Margin has seen a consistent rise over the past five years, as evidenced by the data: 2020: 86.60%; 2021: 86.47%; 2022: 87.87%; 2023: 88.05%; 2024: 89%. This trend underscores the company's growing proficiency in transforming revenue into profit.
The Piotroski F-Score confirms Ansys Inc's solid financial situation based on Joseph Piotroski's nine-point scale, which measures a company's profitability, funding, and operating efficiency. Ansys Inc's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, Ansys Inc demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 10.2%, which outperforms better than 57.87% of 2,509 companies in the Software industry.
Moreover, Ansys Inc has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 12.8%, and the rate over the past five years is 9%. This trend accentuates the company's continued capability to drive growth.
Conclusion: Ansys Inc's Path to Outperformance
With its impressive financial strength, profitability, and growth metrics, Ansys Inc's GF Score highlights the firm's unparalleled position for potential outperformance. The company's strategic initiatives, robust financial health, and consistent growth trajectory make it a compelling choice for value investors seeking long-term gains. As Ansys Inc continues to innovate and expand its market presence, it remains a stock to watch for those aiming to capitalize on its growth potential.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
