Stock (Symbol) |
SS&C Technologies (SSNC) |
Stock Price |
$32 |
Sector |
| Technology |
Data is as of |
| October 3, 2016 |
Expected to Report |
| Oct 31 – Nov 4 |
Company Description |
 SS&C Technologies Holdings, Inc. (SS&C 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. The Company’s portfolio of software 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 (SSNC) is a cloud based provider of financial services software, which it believes is the best financial technology in the industry. SS&C automates fund administration, trading, record keeping, and performance measurement for institutional investment managers. Acquisitions are a big part of SS&C’s growth, with 44 in the last 20 years. SS&C recently acquired Advent (which I use to calculate client returns) as well as Primatics, Varden and Citi’s Alternative Investment Services. The Citi acquisition is important as alternative assets under management have been growing in the teens industrywide and now that the deal has closed revenue for SSNC’s alternative business grew 46% just last qtr. The Citi deal made also SS&C the 2nd largest hedge fund administrator. What’s nice is SSNC can raise prices and its customers just pay more — especially if a firm’s assets under management increase. It’s like when the cable company increases your cable bill. The company continues to gain business but doesn’t mention names. Recent new customer additions include a $1 billion hedge fund, an investment firm launching a private equity fund, a real estate private equity fund, and a family office of one of the wealthiest families in America. In the end, this is a young company that’s grown profits at a healthy rate every year since going public in 2010, with an Est. LTG of 19% a year, selling at a reasonable 20x earnings. |
One Year Chart |
 SSNC had revenues growth of 80% last qtr, which was helped tremendously by acquisitions. Profits grew 18% and beat the street by a penny. Annual Profit Estimates stayed within a penny or two of last qtr’s estimates. Estimates for the next 4 qtrs are 21%, 22%, 24% and 23%. This is a good stock with +20% profit growth expected in each of the next 4 qtrs and a P/E of 20. |
Fair Value |
 My Fair Value on SSNC is 22x earnings. In my eyes the stock is currently 10% undervalued with 33% upside to my 2017 Fair Value. |
Bottom Line |
 SS&C Technologies is a worldwide leader in financial services software that money managers depend on to do their daily business. The stock had a great run after the IPO, was undervalued when I purchased it last qtr, and is still a good value with 33% upside to 2017’s Fair Value. At this day and time it’s difficult to find 20% growers selling for 20x earnings. SSNC ranks 19th of 37 stocks in the Growth Portfolio Power Rankings. |
Power Rankings |
Growth Stock Portfolio
19 of 37Aggressive Growth Portfolio N/AConservative Stock Portfolio N/A |
