Jack Henry & Associates Inc (JKHY) stock analysis

P/E below its 5-year median

Jack Henry & Associates's P/E of 24.4 is below its own 5-year median of 32.1.

P/E below the industry

Jack Henry & Associates's P/E of 24.4 is below the Computer Programming, Data Processing, and Other Computer Related Services median of 27.3.

EV/EBITDA below its 5-year median

Jack Henry & Associates's EV/EBITDA of 19.0 is below its 5-year median of 25.3.

P/B above the industry

Jack Henry & Associates's price-to-book of 5.93 is above the Computer Programming, Data Processing, and Other Computer Related Services median of 3.05.

Trading below fair value

The share price of $177.67 is below our fair value estimate of $189.61.

Margin of safety under 20%

The price is 6.3% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 7.0% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 11.6% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 8.0% over the last twelve months, against a 5-year average of 10.1% a year.

Growing slower than the industry

Revenue grew 7.5% over the last twelve months; the Computer Programming, Data Processing, and Other Computer Related Services median is 9.6%.

Guidance raised

Jack Henry & Associates raised its full year fiscal 2026 deconversion revenue estimate outlook on Apr 28, 2026.

Gross margin improving

Gross margin was 43.8% over the last twelve months, against 43.5% a year earlier.

Return on equity over 15%

Return on equity was 24.3% over the last twelve months and averaged 24.1% over five years.

Return on capital over 10%

Return on invested capital was 23.5%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Jack Henry & Associates's return on equity of 24.3% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -1.1%.

Earnings grew over 5 years

Net income grew 10.1% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 20.0% over the last twelve months, against a 5-year average of 18.5%.

Net margin above the industry

Jack Henry & Associates's net margin of 20.0% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -4.7%.

Low debt

Debt is 4.0% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 7.6% five years ago to 4.0%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 944% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.38 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 10.06; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Jack Henry & Associates paid dividends worth 1.4% of the share price over the last twelve months.

Yield below Treasuries

The 1.4% yield is below the 4.7% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Jack Henry & Associates yields 1.4%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 32.9% of net income.

Covered by free cash flow

Dividends take 23.8% of free cash flow.