Pegasystems Inc. (PEGA) AI Stock Analysis

Pegasystems Inc. develops, licenses, hosts, and supports enterprise software applications across the United States, Europe, Asia-Pacific, and other international regions. Its portfolio centers on the Pega Platform, an application development environment for building and deploying customized solutions, and Pega Infinity, which combines customer engagement with digital process automation. Additional software includes Pega Customer Decision Hub for multi-channel customer acquisition, Pega Sales Automation, and Pega Customer Service. Pegasystems also provides intelligent automation tools and Pega Cloud for hosting, supported by training and certification via Pega Academy.

Between FY2021 and FY2025, annual revenue increased from $1.21B to $1.75B, achieving a 5-year revenue CAGR of 11.4%. In FY2025, revenue grew 16.6% year-over-year, gross margin reached 75.9%, operating margin expanded to 15.1%, and net income rose to $393.4M. Over the trailing twelve months, revenue was $1.74B with an operating margin of 4.6% and diluted EPS of $1.77. In the latest quarter ended June 30, 2026, revenue increased 9.4% year-over-year, while quarterly earnings declined 52.9%.

As of June 30, 2026, Pegasystems held $361.9M in cash and short-term investments against $57.0M in total debt, resulting in a net cash position of $304.9M. Total assets stood at $1.38B, shareholders' equity was $560.4M, the current ratio was 1.06, and the debt-to-equity ratio was 0.10. In FY2025, the company generated $505.2M in operating cash flow and $490.7M in free cash flow. Capital allocation in FY2025 included $14.5M in capital expenditures, $499.7M spent on share buybacks, and $15.4M paid in dividends.

Pegasystems trades at a trailing P/E of 19.5x and a forward P/E of 13.4x, lower than the median of its US-listed Technology peers at 28.1x and 18.8x, respectively. Its enterprise value-to-EBITDA ratio of 25.7x exceeds the peer median of 16.6x, while its price-to-sales multiple is 3.3x versus 2.8x for peers. Over the past year, the stock fell 36.4%, underperforming the SPY return of 16.8%. Over five years, the stock is down 45.8% compared to an 83.0% gain for the SPY.

Pegasystems pays a quarterly dividend with an annualized forward rate of $0.12 per share, yielding 0.35%. The payout ratio stands at 10.2%. The company has paid dividends for 21 consecutive years, delivering an annualized 5-year dividend growth rate of 8.4%. Its last ex-dividend date was October 1, 2026.

Wall Street coverage includes 2 Strong Buy, 2 Buy, and 6 Hold recommendations, with no Sell ratings. The mean price target is $41.57, representing a 20.4% premium over the last close of $34.54. For the fiscal year ending December 31, 2026, consensus estimates project revenue of $1.86B and EPS of $2.39. The company beat EPS estimates in 2 of the last 4 quarters, with the next earnings release scheduled for October 20, 2026.

This page is an AI-written research summary of Pegasystems Inc. (PEGA). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

Related: PEGA income statement, PEGA balance sheet, PEGA key metrics, PEGA analyst forecast, PEGA chart. See the PEGA stock overview for the latest quote and news.