Value
4.7/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 1.8 |
| P/S | 5.1 |
| Fwd P/E | 4.6 |
| PEG | 4.6 |
| Analyst target | 7.5 |
- ▸Forward P/E: 27.1x
- ▸PEG: 1.90
AGYS · Why this verdict
Why Agilysys (AGYS) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.4/10
ConfidenceHIGH
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
A software company with strong earnings growth, excellent cash conversion, and substantial analyst-implied upside is held back by a confirmed downtrend and an uneven recent earnings execution record — a fundamentally capable business in a technically broken chart.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Earnings estimates are trending upward and the growth profile is strong, reflecting analyst confidence that earnings power will expand materially over the coming year. Bull case | Earnings estimates for the next fiscal year rise by more than 10% over the next 6 months, confirming the upward revision trend is holding. | →Stable |
| CounterUpward estimate revisions that precede earnings delivery can reverse sharply if the company misses; with a mixed recent execution record, rising estimates raise the risk that expectations outpace actual performance. | ||
Free cash flow converts at 126% of net income, demonstrating that the business generates more cash than its stated earnings — a sign of high earnings quality and conservative accounting. Quality breakdown | Free cash flow remains above 100% of net income for the next 2 fiscal years, confirming that superior cash generation is a structural rather than one-time characteristic. | →Stable |
| CounterFree cash flow above 100% of net income can reflect deferred tax benefits, favorable working-capital timing, or a low-capex phase; if capital expenditure rises materially, conversion could quickly normalize below 100%, erasing the apparent quality premium. | ||
A death cross is in force with the 200-day moving average sloping down at -4.7% over the past 30 days and declining on-balance volume — a confirmed downtrend with broad participation in the selling. Momentum breakdown | Price crosses back above the 200-day moving average while on-balance volume turns positive over the next 60 days, signaling the downtrend has reversed. | →Stable |
| CounterThe momentum deterioration may be an overreaction to near-term earnings noise; if earnings recover, price can snap back through technical barriers quickly, making the downtrend a timing issue rather than a structural fundamental problem. | ||
Analyst consensus implies 46% upside from current levels, reflecting a wide gap between the depressed share price and the fundamental value the street assigns to the business. Sentiment breakdown | At least 2 analysts raise their price targets over the next 6 months, narrowing the gap between consensus and the stock's prevailing price. | →Stable |
| CounterA large analyst-implied upside alongside a confirmed downtrend can persist for extended periods if near-term earnings delivery does not give the market a reason to close the gap; consensus can be wrong or slow to adjust if business fundamentals are softer than models assume. | ||
The company has delivered 2 beats and 2 misses over the past 4 quarters with an average EPS surprise near zero (approximately 3.6%), suggesting earnings delivery is inconsistent and the company is not reliably setting and clearing expectations. Earnings | EPS beats consensus estimates in each of the next 3 consecutive quarters, establishing a more consistent execution track record. | →Stable |
| CounterThe most recent quarter was a beat of nearly 27%, which may mark the start of a more consistent delivery period; one strong beat can shift analyst calibration and pave the way for a more reliable beat pattern going forward. | ||
Earnings estimates are trending upward and the growth profile is strong, reflecting analyst confidence that earnings power will expand materially over the coming year.
→StableBull case
- Expectation
- Earnings estimates for the next fiscal year rise by more than 10% over the next 6 months, confirming the upward revision trend is holding.
CounterUpward estimate revisions that precede earnings delivery can reverse sharply if the company misses; with a mixed recent execution record, rising estimates raise the risk that expectations outpace actual performance.
Free cash flow converts at 126% of net income, demonstrating that the business generates more cash than its stated earnings — a sign of high earnings quality and conservative accounting.
→StableQuality breakdown
- Expectation
- Free cash flow remains above 100% of net income for the next 2 fiscal years, confirming that superior cash generation is a structural rather than one-time characteristic.
CounterFree cash flow above 100% of net income can reflect deferred tax benefits, favorable working-capital timing, or a low-capex phase; if capital expenditure rises materially, conversion could quickly normalize below 100%, erasing the apparent quality premium.
A death cross is in force with the 200-day moving average sloping down at -4.7% over the past 30 days and declining on-balance volume — a confirmed downtrend with broad participation in the selling.
→StableMomentum breakdown
- Expectation
- Price crosses back above the 200-day moving average while on-balance volume turns positive over the next 60 days, signaling the downtrend has reversed.
CounterThe momentum deterioration may be an overreaction to near-term earnings noise; if earnings recover, price can snap back through technical barriers quickly, making the downtrend a timing issue rather than a structural fundamental problem.
Analyst consensus implies 46% upside from current levels, reflecting a wide gap between the depressed share price and the fundamental value the street assigns to the business.
→StableSentiment breakdown
- Expectation
- At least 2 analysts raise their price targets over the next 6 months, narrowing the gap between consensus and the stock's prevailing price.
CounterA large analyst-implied upside alongside a confirmed downtrend can persist for extended periods if near-term earnings delivery does not give the market a reason to close the gap; consensus can be wrong or slow to adjust if business fundamentals are softer than models assume.
The company has delivered 2 beats and 2 misses over the past 4 quarters with an average EPS surprise near zero (approximately 3.6%), suggesting earnings delivery is inconsistent and the company is not reliably setting and clearing expectations.
→StableEarnings
- Expectation
- EPS beats consensus estimates in each of the next 3 consecutive quarters, establishing a more consistent execution track record.
CounterThe most recent quarter was a beat of nearly 27%, which may mark the start of a more consistent delivery period; one strong beat can shift analyst calibration and pave the way for a more reliable beat pattern going forward.
Per-dimension breakdown
Quality
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.4 |
| ROA | 3.1 |
| Gross margin | 8.5 |
| Op margin | 6.0 |
| Net margin | 6.1 |
| Current ratio | 5.4 |
| FCF quality | 9.2 |
| Moat | 6.9 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 126% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
7.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.4 |
| EPS growth | 10.0 |
Momentum
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 7.5 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -4.1%/30d — confirmed downtrend
Sentiment
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.6 |
| Price target | 9.1 |
| erm sentiment | 5.8 |
- ▸Light analyst coverage (6.0) — signal dampened
- ▸Analyst upside: 38%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Insider selling (low materiality) — $276,850 (0.011% of mkt cap)
Peer rank
3.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 1.6 |
| quality rank | 6.0 |
| growth rank | 3.6 |
Technical
1.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.9 |
| support resistance | 1.0 |
| 52w position | 2.7 |
Risk (lower is worse)
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.1 |
| days to cover | 8.0 |
| volatility | 0.7 |
| put call | 2.2 |
| implied vol | 3.4 |
| beta | 10.0 |
| debt equity | 0.0 |
- ▸Elevated put/call: 1.67
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 4.3 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:26d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.8<4.5
- ASYMMETRY:1.3<1.5@spot
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
1.33
Upside
+20.0%
Downside
15.0%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — MCap $2.4B<$5B
Investment implication
The F-path SELL output reflects an overall score of 3.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 7.7) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:3.8<4.5, ASYMMETRY:1.3<1.5@spot, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 1.33 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 7.7, Sentiment at 7.6, and Quality at 6.4; the weakest are Technical at 1.9, Peer rank at 3.5, and Momentum at 3.8. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of 1.33 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings estimates are trending upward and the growth profile is strong, reflecting analyst confidence that earnings power will expand materially over the coming year.
Trip ifEarnings estimates for the next fiscal year are revised down by more than 10% within any 90-day window.
- P2Free cash flow converts at 126% of net income, demonstrating that the business generates more cash than its stated earnings — a sign of high earnings quality and conservative accounting.
Trip ifFree cash flow falls below 70% of net income for 2 consecutive fiscal years.
- P3A death cross is in force with the 200-day moving average sloping down at -4.7% over the past 30 days and declining on-balance volume — a confirmed downtrend with broad participation in the selling.
Trip ifPrice crosses back above the 200-day moving average and RSI rises above 50 for 10 consecutive trading days.
- P4Analyst consensus implies 46% upside from current levels, reflecting a wide gap between the depressed share price and the fundamental value the street assigns to the business.
Trip ifConsensus price target compresses below $92, reducing implied upside to less than 5% from the current price.
- P5The company has delivered 2 beats and 2 misses over the past 4 quarters with an average EPS surprise near zero (approximately 3.6%), suggesting earnings delivery is inconsistent and the company is not reliably setting and clearing expectations.
Trip ifEPS exceeds consensus in each of the next 3 consecutive quarters, with a positive surprise each time.