Investment Thesis
Bentley Systems demonstrates strong software fundamentals with 82.6% gross margins, 11% revenue growth, and exceptional 44.3% FCF margins indicating high-quality cash generation. However, the current ratio of 0.51x raises significant liquidity concerns, and flat net income growth despite revenue expansion suggests margin compression that requires monitoring.
Strengths
- Exceptional free cash flow generation at 44.3% margin ($187.9M FCF) with minimal capital intensity
- High gross margins (82.6%) and strong operating margins (29.8%) demonstrating pricing power and software quality
- Solid revenue growth at 11% YoY with strong interest coverage ratio of 16.8x indicating financial stability
Risks
- Critical liquidity concern with current ratio of 0.51x indicating current liabilities exceed current assets
- Net income flat YoY despite 11% revenue growth signals margin compression or rising operational costs
- Leverage of 0.91x debt-to-equity combined with low ROE (7.8%) and ROA (2.7%) suggests capital efficiency issues
Key Metrics to Watch
- Quarterly current ratio trend and working capital management
- Net income growth acceleration relative to revenue growth - margin recovery essential
- Operating cash flow sustainability and percentage of revenue conversion
Financial Metrics
Revenue
424.2M
Net Income
95.4M
EPS (Diluted)
$0.30
Free Cash Flow
187.9M
Total Assets
3.5B
Cash
105.2M
Profitability Ratios
Gross Margin
82.6%
Operating Margin
29.8%
Net Margin
22.5%
ROE
7.8%
ROA
2.7%
FCF Margin
44.3%
Balance Sheet & Liquidity
Current Ratio
0.51x
Quick Ratio
0.51x
Debt/Equity
0.91x
Debt/Assets
65.2%
Interest Coverage
16.78x
Long-term Debt
1.1B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-09T09:49:00.232292 |
Data as of: 2026-03-31 |
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