Last Updated: 11 Nov 2024
Executive Summary
Descartes Systems Group Inc. (DSGX) is a leading provider of cloud-based logistics and supply chain management solutions. The company has a strong track record of growth and profitability, and its shares have outperformed the broader market in recent years. DSGX is currently trading at $115 per share, which is below its 52-week high of $115.42 but above its 50-day moving average of $103.29.
Company Overview
Descartes Systems Group was founded in 1981 and is headquartered in Waterloo, Canada. The company provides a wide range of software and services that help businesses manage their logistics and supply chains. DSGX's customers include some of the world's largest retailers, manufacturers, and transportation providers.
Fundamental Analysis
Descartes Systems Group has a strong financial profile. The company has a market capitalization of $9.86 billion and an EBITDA of $247.4 million. DSGX's profit margin is 21%, and its operating margin is 28.1%. The company has a strong balance sheet with $1.5 billion in cash and equivalents and no debt.
DSGX's revenue has grown at a compound annual growth rate (CAGR) of 10% over the past five years. The company's earnings per share (EPS) have grown at a CAGR of 15% over the same period. DSGX is expected to continue to grow in the future, with analysts forecasting EPS growth of 10% in 2023 and 12% in 2024.
Technical Analysis
Descartes Systems Group's stock price has been in a bullish trend since March 2020. The stock has made several higher highs and higher lows during this period, and it is currently trading above its 50-day and 200-day moving averages. The stock's relative strength index (RSI) is 60, which indicates that it is overbought. However, the stock's moving average convergence divergence (MACD) is positive, which indicates that the bullish trend is still intact.
Short Term Outlook
In the short term, Descartes Systems Group's stock price is likely to continue to trade in a range between $105 and $115. The stock is overbought, but the bullish trend is still intact. If the stock breaks above $115, it could rally to $120 or higher. If the stock breaks below $105, it could fall to $100 or lower.
Long Term Outlook
In the long term, Descartes Systems Group's stock price is likely to continue to rise. The company has a strong financial profile, a growing customer base, and a bright future in the logistics and supply chain management market. Analysts have a median price target of $108.79 for DSGX, which represents a potential upside of 10% from the current price.
Analyst Recommendations
Analysts are bullish on Descartes Systems Group. Of the 11 analysts who cover the stock, 8 have a buy rating, 2 have a hold rating, and 1 has a sell rating. The consensus price target is $108.79.
