Pegasystems (NASDAQ:PEGA) Sets New 1-Year Low After Earnings Miss

Pegasystems Inc. (NASDAQ:PEGA) reached a new 52-week low on Wednesday following a weaker than expected earnings announcement. The stock traded as low as $25.11 and last traded at $25.5130, with a volume of 442845 shares changing hands. The stock had previously closed at $30.94.

The technology company reported $0.35 earnings per share for the quarter, missing the consensus estimate of $0.43 by ($0.08). The business had revenue of $420.72 million for the quarter, compared to the consensus estimate of $427.38 million. Pegasystems had a net margin of 20.04% and a return on equity of 30.05%. During the same quarter in the previous year, the company earned $0.28 EPS.

Pegasystems Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Wednesday, July 15th. Investors of record on Wednesday, July 1st were paid a $0.03 dividend. The ex-dividend date of this dividend was Wednesday, July 1st. This represents a $0.12 annualized dividend and a yield of 0.4%. Pegasystems’s payout ratio is currently 6.45%.

More Pegasystems News

Here are the key news stories impacting Pegasystems this week:

• Positive Sentiment: Pega Cloud ACV grew 22% year over year, showing continued strength in the company’s cloud business.
• Positive Sentiment: First-half operating cash flow remained strong, supporting the company’s financial flexibility.
• Neutral Sentiment: Analysts at Citizens JMP downgraded Pegasystems from outperform to market perform, reflecting more cautious sentiment after the earnings report.
• Neutral Sentiment: Several recent articles highlighted the Q2 earnings snapshot and the size of the miss versus estimates, reinforcing the market’s focus on the quarter’s weaker-than-expected results. Article Title
• Negative Sentiment: Q2 earnings and revenue missed Wall Street estimates, which is the primary reason the stock is under pressure.
• Negative Sentiment: Management said AI-related market shifts caused some customers to delay buying decisions, raising concerns about slower near-term bookings and ACV growth.

Wall Street Analyst Weigh In

A number of equities analysts have commented on PEGA shares. Zacks Research lowered shares of Pegasystems from a “strong-buy” rating to a “hold” rating in a research report on Friday, April 24th. Royal Bank Of Canada reiterated an “outperform” rating on shares of Pegasystems in a research note on Tuesday, June 9th. DA Davidson reissued a “buy” rating and issued a $55.00 target price on shares of Pegasystems in a report on Wednesday, June 10th. Rosenblatt Securities restated a “buy” rating and set a $58.00 price target on shares of Pegasystems in a research report on Thursday, July 16th. Finally, Weiss Ratings downgraded Pegasystems from a “hold (c+)” rating to a “hold (c)” rating in a research report on Thursday, June 4th. Six equities research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. Based on data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average price target of $63.30.

Insider Activity

In related news, CAO Efstathios A. Kouninis sold 750 shares of the stock in a transaction dated Friday, May 29th. The stock was sold at an average price of $34.75, for a total transaction of $26,062.50. Following the completion of the transaction, the chief accounting officer directly owned 2,894 shares in the company, valued at approximately $100,566.50. This trade represents a 20.58% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, insider Rifat Kerim Akgonul sold 4,545 shares of Pegasystems stock in a transaction dated Tuesday, May 19th. The stock was sold at an average price of $33.35, for a total value of $151,575.75. Following the transaction, the insider owned 107,070 shares of the company’s stock, valued at $3,570,784.50. The trade was a 4.07% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 6,795 shares of company stock valued at $229,613 over the last 90 days. Corporate insiders own 48.40% of the company’s stock.

Institutional Investors Weigh In On Pegasystems

Several institutional investors have recently made changes to their positions in the stock. AQR Capital Management LLC boosted its position in shares of Pegasystems by 236.2% during the 2nd quarter. AQR Capital Management LLC now owns 4,037,552 shares of the technology company’s stock worth $217,584,000 after acquiring an additional 2,836,733 shares in the last quarter. Invesco Ltd. lifted its stake in Pegasystems by 14.8% in the 4th quarter. Invesco Ltd. now owns 3,127,771 shares of the technology company’s stock valued at $186,790,000 after purchasing an additional 402,763 shares during the last quarter. State Street Corp boosted its position in Pegasystems by 255.3% in the second quarter. State Street Corp now owns 2,907,677 shares of the technology company’s stock valued at $157,393,000 after buying an additional 2,089,375 shares in the last quarter. Wellington Management Group LLP grew its stake in shares of Pegasystems by 28.3% during the fourth quarter. Wellington Management Group LLP now owns 2,721,958 shares of the technology company’s stock worth $162,555,000 after buying an additional 599,790 shares during the last quarter. Finally, Dimensional Fund Advisors LP grew its stake in shares of Pegasystems by 2.5% during the fourth quarter. Dimensional Fund Advisors LP now owns 2,529,767 shares of the technology company’s stock worth $151,094,000 after buying an additional 61,251 shares during the last quarter. 46.89% of the stock is currently owned by institutional investors.

Pegasystems Trading Down 12.2%

The company has a market capitalization of $4.54 billion, a P/E ratio of 14.45 and a beta of 0.87. The stock has a 50 day moving average price of $32.55 and a 200 day moving average price of $40.24.

Pegasystems Company Profile

Pegasystems Inc is a software company specializing in customer engagement and digital process automation solutions. Headquartered in Cambridge, Massachusetts, Pegasystems develops enterprise applications designed to help organizations streamline operations, manage customer interactions and automate complex workflows. Its platform supports a wide range of use cases, from sales and marketing optimization to case management and robotic process automation.

The core of Pegasystems’ offering is the Pega Platform, a low-code development environment that enables businesses to build and deploy applications with minimal hand-coding.