Citi has revised its price target for Progress Software, adjusting it from $64 to $57 while maintaining a Neutral rating on the stock. This update follows the company's second-quarter financial report, prompting Citi to re-evaluate the firm's projections. The decision reflects current market conditions and the latest performance metrics observed in the recent financial disclosures for (PRGS, Financial).
Wall Street Analysts Forecast
Based on the one-year price targets offered by 6 analysts, the average target price for Progress Software Corp (PRGS, Financial) is $71.67 with a high estimate of $83.00 and a low estimate of $57.00. The average target implies an upside of 46.86% from the current price of $48.80. More detailed estimate data can be found on the Progress Software Corp (PRGS) Forecast page.
Based on the consensus recommendation from 6 brokerage firms, Progress Software Corp's (PRGS, Financial) average brokerage recommendation is currently 1.8, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Progress Software Corp (PRGS, Financial) in one year is $80.40, suggesting a upside of 64.75% from the current price of $48.8. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Progress Software Corp (PRGS) Summary page.
PRGS Key Business Developments
Release Date: June 30, 2025
- Total Revenue: $237 million, up 36% year-over-year.
- Annual Recurring Revenue (ARR): $838 million, 46% growth year-over-year, 2% pro forma growth.
- Net Retention Rate: 100%.
- Operating Margin: 40%.
- Earnings Per Share (EPS): $1.40, $0.06 above guidance.
- Debt Repayment: $40 million paid down on revolving credit line.
- Cash and Cash Equivalents: $102 million.
- Total Debt: $1.47 billion.
- Unlevered Free Cash Flow: $52 million.
- Share Repurchase: $20 million in Q2, $50 million in the first half of 2025.
- Q3 Revenue Guidance: $237 million to $243 million.
- Full Year 2025 Revenue Guidance: $962 million to $974 million.
- Full Year 2025 EPS Guidance: $5.28 to $5.40.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Progress Software Corp (PRGS, Financial) reported a 36% increase in total revenue year-over-year, reaching $237 million.
- Annual Recurring Revenue (ARR) grew by 46% year-over-year, totaling $838 million, with a net retention rate of 100%.
- The company successfully integrated ShareFile ahead of schedule, completing major operational synergies.
- Progress Software Corp (PRGS) raised its full-year guidance, reflecting confidence in continued business strength and expense control.
- The acquisition of Nuclia is expected to enhance product offerings with advanced AI capabilities, potentially benefiting multiple product lines.
Negative Points
- Free cash flow for the quarter was below expectations, attributed to timing issues and the transition of ShareFile onto Progress's billing system.
- The company's debt remains high, with a total debt of $1.47 billion and a net debt position of $1.37 billion.
- The integration of ShareFile led to a temporary increase in Days Sales Outstanding (DSO), rising to 53 days from 48 days in the previous quarter.
- Despite the acquisition of Nuclia, it is not expected to have a material impact on financial results in the second half of 2025.
- The company's operating expenses increased by 31% year-over-year, driven by the addition of ShareFile to the business.
