PegasystemsFRA:PEA +4.42%75 Gross Margin % is 75.17% as of Mar. 2026, which is 6% above its 10-year median of 70.74. GuruFocus rates FRA:PEA with a GF Score™ of 75/100 and a GF Value™ of €35.99 (Modestly Undervalued). The stock has 2 warning signs investors should review. Among 2,681 Software companies, Pegasystems ranks better than 84.41% on this metric.
The historical rank and industry rank for Pegasystems's Gross Margin % or its related term are showing as below:
FRA:PEA'
s Gross Margin % Range Over the Past 10 Years
Min: 65.98 Med: 70.74 Max: 75.86
Current: 74.96
During the past 13 years, the highestGross Margin % of Pegasystems was 75.86%. The lowest was 65.98%. And the median was 70.74%.
FRA:PEA's Gross Margin % is ranked better than 84.41% of 2681
companies
in the Software industry
Industry Median: 40.41
vs FRA:PEA: 74.96
Pegasystems had a gross margin of 75.17% for the quarter that ended in Mar. 2026 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Pegasystems was 1.50% per year.
Pegasystems (FRA:PEA) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Pegasystems had a gross margin of 75.17% for the quarter that ended in Mar. 2026 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Pegasystems Gross Margin % Related Terms
Pegasystems Gross Margin % Historical Data
* Premium members only.
The historical data trend for Pegasystems's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
FRA:PEA vs LYFT, APPF, YOU: Gross Margin % Comparison
For the Software - Application subindustry, Pegasystems's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Pegasystems Gross Margin % vs Software Industry
For the Software industry and Technology sector, Pegasystems's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Pegasystems's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Pegasystems (FRA:PEA) has a Gross Margin % of 75.17% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Pegasystems and its competitors. This is near median its historical median of 70.74. Over the past decade, Pegasystems' Gross Margin % has ranged from 65.98 to 75.86. According to the industry distribution chart, Pegasystems ranks #418 out of 2681 companies in the Software industry, placing it in the top 15.6%.
Is Pegasystems' Gross Margin % too high?
Pegasystems' current Gross Margin % of 75.17% is near median its 10-year median of 70.74. Over the past 10 years, this metric has ranged from a low of 65.98 to a high of 75.86. The Software industry median Gross Margin % is 40.41. Pegasystems' value of 75.17% is 86% above this industry median. Based on the distribution chart, Pegasystems ranks #418 out of 2681 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Pegasystems has a GF Score™ of 75/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Pegasystems' Gross Margin % compare to LYFT and APPF?
According to the Software industry distribution chart, Pegasystems ranks #418 out of 2681 companies for Gross Margin %. This places Pegasystems in the top 16% of its industry — outperforming the majority of peers. The industry median Gross Margin % is 40.41. Pegasystems' value of 75.17% is 86% above this benchmark. Historically, Pegasystems' own Gross Margin % has ranged from 65.98 to 75.86 over the past decade. While the company's 10-year median is 70.74 vs. the industry median of 40.41, Pegasystems has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Software company?
The median Gross Margin % among Software companies is 40.41, based on 2,681 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Pegasystems's current Gross Margin % of 75.17% is 86% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Pegasystems and its competitors. For the Software industry, the median Gross Margin % is 40.41 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Pegasystems's current Gross Margin % is 75.17%, which is near median its own 10-year median of 70.74. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Pegasystems stock overvalued right now?
Based on GuruFocus' analysis, Pegasystems (FRA:PEA) is currently considered Modestly Undervalued. The stock's GF Value™ is €35.99, compared to a current price of €27.14 — trading 24.6% below its estimated fair value. The current Gross Margin % is 75.17%, which is near median its 10-year median of 70.74 and 86% above the Software industry median of 40.41. Pegasystems' overall GF Score™ is 75/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Pegasystems (FRA:PEA), the current Gross Margin % is 75.17% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Pegasystems (FRA:PEA) Overvalued in 2026?
Based on GuruFocus' analysis, Pegasystems stock appears to be undervalued.
The current stock price of €27.14 is trading 24.6% below its estimated GF Value™ of €35.99.
GuruFocus considers Pegasystems to be Modestly Undervalued.
Key valuation signals for FRA:PEA:
Gross Margin %: 75.17% (near median its 10-year median of 70.74)
GF Value™: €35.99 vs. price of €27.14 (24.6% below fair value)
Industry Position: 86% above the Software median (#418 of 2681)
No single metric tells the full story. See the FRA:PEA stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Founded in 1983, Pegasystems provides a suite of solutions for customer engagement and business process management. The company's key offering is the Pega Infinity platform, which combines business process management with customer relationship management applications. The company focuses on enterprise-size customers in the financial, insurance, and healthcare industries.
75GF Score
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