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Pegasystems Inc. (PEGA) vs Ringcentral, Inc. (RNG)

Pegasystems Inc. and Ringcentral, Inc. are both Software Application companies. Ringcentral, Inc. is the larger, with a market value of $6.6B against $5.6B — 1.2× the size. Ringcentral, Inc. trades at the lower P/E: 9.5× against 19.3×. Ringcentral, Inc. grew revenue faster over the last twelve months: 5.46% against 0.93%. Ringcentral, Inc. has the higher net margin (25.1% vs 16.9%) and the lower return on invested capital (13.8% vs 45.2%). Both pay a dividend; Ringcentral, Inc. yields more (0.37% vs 0.36%). Across the 21 metrics below, Ringcentral, Inc. leads on 14 and Pegasystems Inc. on 7.

Valuation

Metric PEGA RNG Software Application median
P/E 19.31 9.51 25.90
P/S 3.15 2.38 3.04
P/B 10.02 n/m 2.60
Price to free cash flow 12.44 10.38 17.17
EV/EBITDA 23.26 12.21 15.48
EV/Sales 3.52 2.73 2.89
Earnings yield 5.18% 10.52% 0.00%
Free cash flow yield 8.04% 9.63% 1.98%

Profitability

Metric PEGA RNG Software Application median
Gross margin 75.86% 72.17% 66.89%
Operating margin 9.90% 7.50% 0.00%
Net margin 16.86% 25.08% 0.00%
Free cash flow margin 25.29% 23.03% 5.77%
Return on equity 51.45% (240.74%) 0.00%
Return on assets 22.47% 38.62% 0.00%
Return on invested capital 45.18% 13.84% 0.00%

Growth

Metric PEGA RNG Software Application median
Revenue growth (TTM) 0.93% 5.46% 12.27%
EPS growth (last fiscal year) 283.78% 176.19% 32.11%
Revenue growth, 5-year CAGR 11.40% 16.27% 14.34%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric PEGA RNG Software Application median
Debt to equity 0.00 (81.60) 0.02
Current ratio 1.04 1.06 1.53
Net debt to EBITDA (1.19) 2.19 0.09

Dividend

Metric PEGA RNG Software Application median
Dividend yield 0.36% 0.37% 1.10%
Payout ratio 0.07 0.04 0.28

Size

Metric PEGA RNG Software Application median
Market cap 5.62b 6.58b 487.58m

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