Stock (Symbol) |
SS&C Technologies (SSNC) |
Stock Price |
$50 |
Sector |
| Technology |
Data is as of |
| April 15, 2018 |
Expected to Report |
| May 1 |
Company Description |
 SS&C Technologies Holdings is a holding company. The Company is a provider of software products and software-enabled services that allow financial services providers to automate complex business processes and manage their information processing requirements. SS&C’s products and software-enabled services allows its clients to automate and integrate front-office functions, such as trading and modeling, middle-office functions, such as portfolio management and reporting, and back-office functions, such as accounting, performance measurement, reconciliation, reporting, processing and clearing. Source: Thomson Financial |
Sharek’s Take |
 SS&C Technologies is a financial software company that is the biggest alternative-fund administrator in the world. SS&C is also the world’s biggest private-equity fund administrator, as well as the largest provider of financial software. The company grows primarily through acquisitions (and partially from raising software prices every year). SS&C has completed more than 40 companies acquired in the last 20 years. During the last two years it’s acquired Citi Alternative Investor Services (which tracks alternative investments), Salentica (a CRM which works with Salesforce) Wells Fargo Fund Services and Conifer Financial Services. Alternative investments into crypto-currencies like BitCoin are hot right now. New hedge funds that are coming out to invest in cypto-currencies will likely use SS&C to provide fund administration, trading, record keeping, and performance measurement to money managers. SS&C just agreed to acquire DST Systems, a provider of technology and outsourcing services for Finance and Healthcare firms. SSNC stock jumped to new-highs on the news, which tells me investors think long-term growth of around 20% a year will be ensured. Analysts don’t have an Est. LTG on the stock, but I feel it’s a 20% grower and is worth 24x earnings. That equates to Fair Values of $55 this year and $60 next. SSNC won’t get much savings from the new tax plan. |
One Year Chart |
 Boom! This stock took off after the DST deal. I feel this deal gives SS&C more opportunity for outsourcing income. Even without the added profits, qtrly Estimates of 23%, 20%, 16% and 13% look good. There’s plenty of time for the 3QtrsOut and 4QtrsOut estimates to increase. Notice the Est. LTG is missing, I think this is a 20% grower long-term. |
Fair Value |
 That would be stable income. This deal also gives more certainty to annual profit estimates of $2.28, $2.52 and $2.75 the next three years. SSNS’s P/E was 18 last qtr, 22 now, and that’s taken some of my short-term upside away. i wonder if annual estimates will rise more next qtr. This qtr they only increased 7 cents in each 2018 & 2019. |
Bottom Line |
 SS&C Technologies’ software is what many money managers use to handle a fund’s record-keeping tasks — and soon outsourcing tech projects too. Look at the Annual Profit history on the right. Up every year. And since its IPO investors have sometimes felt growth could slow (I wondered). But then management would find another acquisition to boost profit growth. 22x earnings is a reasonable price for this stock too. I imagine SS&C will eventually get bought out itself. SSNC ranks 35th of 39 stocks in the Growth Portfolio Power Rankings. I was “getting a little bored with this stock” last qtr and luckily I held. |
Power Rankings |
Growth Stock Portfolio
35 of 39Aggressive Growth Portfolio N/AConservative Stock Portfolio N/A |
