Value
3.4/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 1.2 |
| P/S | 3.7 |
| Fwd P/E | 3.0 |
| PEG | 4.1 |
| Analyst target | 5.0 |
- ▸Forward P/E: 35.8x
- ▸PEG: 2.39
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. How we score · Editorial policy
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VerdictSELL
Overall score5.5/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Agilysys is a high-quality software business with a wide moat, 139% cash conversion and a 3-of-4 earnings beat streak, but a 35.2x forward P/E, heavy insider selling and only 6.9% upside to the analyst target limit the entry case.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Forward P/E of 35.2x and a PEG of 2.39 mean the shares are expensive relative to growth. Valuation breakdown | Earnings growth accelerates enough to bring the forward multiple below 30x. | ↑Improving |
| CounterA premium multiple leaves little room for error, and a technology sector modifier of -0.8 weighs on the rating. | ||
Agilysys shows excellent 139% cash conversion, a wide economic moat and a perfect 9/9 Piotroski score. Quality breakdown | FCF-to-net-income stays above 100% and the Piotroski score stays at 8 or higher. | ↑Improving |
| CounterMargins are modest with ROE at a middling score, so quality may not translate into returns that justify the price. | ||
Agilysys beat estimates in 3 of the last 4 quarters with a 15.5% average surprise, including 21.5% on 2026-10-26. Avg surprise pct | Next report in January 2027 beats consensus again. | →Stable |
| CounterThe January 2026 miss of 7.8% shows beats are not certain at this valuation. | ||
Insiders sold about $23.1M, equal to 0.708% of market cap, which scores as heavy selling. Insider breakdown | Insider selling slows below 0.2% of market cap. | →Stable |
| CounterConcentrated selling by insiders at a premium valuation can signal that those closest to the business see limited upside. | ||
The $123.83 analyst target offers only 6.9% upside against 15.0% downside from $115.80, a reward-to-risk of 0.46, despite a bullish golden-cross breakout. Estimated upside | Analyst targets rise above $135 as the breakout holds. | ↑Improving |
| CounterWith falling on-balance volume the breakout may fail and the downside exceeds the upside. | ||
Forward P/E of 35.2x and a PEG of 2.39 mean the shares are expensive relative to growth.
↑ImprovingValuation breakdown
- Expectation
- Earnings growth accelerates enough to bring the forward multiple below 30x.
CounterA premium multiple leaves little room for error, and a technology sector modifier of -0.8 weighs on the rating.
Agilysys shows excellent 139% cash conversion, a wide economic moat and a perfect 9/9 Piotroski score.
↑ImprovingQuality breakdown
- Expectation
- FCF-to-net-income stays above 100% and the Piotroski score stays at 8 or higher.
CounterMargins are modest with ROE at a middling score, so quality may not translate into returns that justify the price.
Agilysys beat estimates in 3 of the last 4 quarters with a 15.5% average surprise, including 21.5% on 2026-10-26.
→StableAvg surprise pct
- Expectation
- Next report in January 2027 beats consensus again.
CounterThe January 2026 miss of 7.8% shows beats are not certain at this valuation.
Insiders sold about $23.1M, equal to 0.708% of market cap, which scores as heavy selling.
→StableInsider breakdown
- Expectation
- Insider selling slows below 0.2% of market cap.
CounterConcentrated selling by insiders at a premium valuation can signal that those closest to the business see limited upside.
The $123.83 analyst target offers only 6.9% upside against 15.0% downside from $115.80, a reward-to-risk of 0.46, despite a bullish golden-cross breakout.
↑ImprovingEstimated upside
- Expectation
- Analyst targets rise above $135 as the breakout holds.
CounterWith falling on-balance volume the breakout may fail and the downside exceeds the upside.
Per-dimension breakdown
Quality
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.5 |
| ROA | 4.2 |
| Gross margin | 8.8 |
| Op margin | 6.5 |
| Net margin | 6.4 |
| Current ratio | 6.7 |
| FCF quality | 9.6 |
| Moat | 8.4 |
| Piotroski F | 10.0 |
- ▸Excellent cash conversion: 139% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
- ▸Strong Piotroski F-Score: 9/9
Growth
5.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.9 |
| EPS growth | 4.4 |
Momentum
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 8.0 |
| Volume | 2.5 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.6 |
| Price target | 7.5 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (6.0) — signal dampened
Insider
3.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 5.9 |
- ▸Heavy insider selling — $23,132,759 (0.695% of mkt cap)
Peer rank
5.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 1.4 |
| quality rank | 5.9 |
| growth rank | 6.1 |
- ▸Conservative debt levels
Technical
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.3 |
| support resistance | 2.2 |
| 52w position | 6.5 |
Risk (lower is worse)
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.1 |
| days to cover | 3.2 |
| volatility | 1.1 |
| put call | 9.9 |
| implied vol | 3.8 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 9.8 |
- ▸Above max pain $80
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:7.1>=5.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:83d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:0.2<1.5@spot
- INSIDER:0.69%=HEAVY
Warning (0)
none
Reward-to-Risk
0.22
Upside
+3.3%
Downside
15.0%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 67, MACD bullish
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $3.3B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Quality at 7.2) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.2<1.5@spot, INSIDER:0.69%=HEAVY) reinforce the read. Current asymmetry R:R is 0.22 — supplementary context, not the trigger for this path.
The strongest dimensions are Quality at 7.2, Momentum at 7.1, and Sentiment at 6.8; the weakest are Insider at 3.3, Value at 3.4, and Technical at 3.7. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 0.22 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Wide Moat Software
Trip ifFCF-to-net-income falls below 70% from the current 139%.
- P2Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P3Rich Valuation
Trip ifForward P/E exceeds 45x from the current 35.2x.
- P4Heavy Insider Selling
Trip ifInsider selling exceeds 1.5% of market cap over 90 days.
- P5Thin Upside Breakout Setup
Trip ifPrice falls below the $107.69 stop-loss level.