Table of Contents :
• Stock Rating & Target Price
• Investment Thesis
• Fundamental Models Used
• Company Description
• Corporate Timeline
• Key Metrics (KPI ) and Recently Reported Earnings Review
• Business Highlights, Strategic Announcements & Outlook
• Quarter-over-Quarter (Q-o-Q) and Year-over-Year (Y-o-Y) Growth Analysis
• Key Catalysts Driving Growth
• Historical Financial Statement Analysis & CAGR Trends
• Quarterly Key Financial Ratios and Performance Metrics
• Annual Financial Performance Analysis: Horizontal and Vertical Financial Analysis, Trends
• Financial Forecasts
• Annual Forecasts: Income Statement
• Annual Forecasts: Cash Flow Statements
• Net Debt Levels
• A Closer Look at DCF: Our Assumptions and Methodology
• Terminal Value Calculation
• Target Price Analysis
• Valuation Multiples
• Supplementary Valuation Analysis: Multiples Approach
• Scenario/Sensitivity Analysis – Base Case , Bull Case ,Bear Case
• Holistic Peer Review & Trading Comps: Financial Data, Operational Metrics, and Valuation Multiples
• Implied Price Per Share
• Ownership Activity/ Insider Trades
• Ownership Summary
• An analysis of ESG Risk Rating
• Key Professionals
• Key Board Members
• Key Risks Considerations
• Analyst Ratings
• Analyst Industry Views
• Disclosures
SS&C Technologies (SSNC): Game-Changing Battea Acquisition and Strong Retention Rates, But Could Direct Indexing as an industry-level trend Derail Its Growth Story- What’s the impact, outlook & its Key Catalysts?
SS&C Technologies delivered a strong Q3 2024, with adjusted revenue reaching a record $1.467 billion (+7.3% YoY), exceeding expectations by $24.8 million, while adjusted EBITDA of $566.2 million maintained a solid margin of 38.6%. Adjusted EPS climbed 10.3% to $1.29, beating estimates by $0.03, and operating cash flow surged 39% YoY to $336.6 million, showcasing scalability and robust cash flow conversion (103%). Wealth and Investment Technologies (WIT) led growth with 10.9% organic revenue expansion, while the Battea acquisition contributed immediate accretion, adding $95 million in annualized revenue and opening cross-sell opportunities in fund administration. Automation through Blue Prism continues to drive efficiencies, reducing over 1,000 FTEs and positioning SS&C for long-term productivity gains. Despite Q4 guidance projecting 2.4% organic growth, reflecting licensing lumpiness and challenging comparisons, FY24 guidance remains strong, with adjusted revenue of $5.815-$5.855 billion and EPS of $5.12-$5.18. Headwinds include healthcare industry pressures and evolving trends like direct indexing, which could shift dynamics in fund administration. However, SS&C’s diverse client base, 95%+ retention rates, and leadership in alternatives AUM provide resilience. Can SS&C sustain its growth momentum and capitalize on its diversified offerings amidst industry shifts like direct indexing while unlocking synergies from Battea and automation-led efficiencies?
