Progress Software: AI Risk Demands A Bigger Discount

Oliver Rodzianko 7.3K Followers Follow Summary Progress Software Corporation's adjusted EPS rose 13% and adjusted free cash flow grew 17%, but revenue fell 2% and annual recurring revenue increased just 1% in constant currency. Sticky customers and capacity-based pricing offer protection, but AI disruption, Domo integration, and added debt constrain my confidence in PRGS's durable growth. My estimated fair value of $34.50 sits below the $37.50 share price. Despite a low adjusted P/E and potential sentiment recovery, I see insufficient margin of safety. Hold. Shane McDermott/iStock via Getty Images Since my last analysis on Progress Software Corporation ( PRGS ), the stock has moved -12% in price. The company just reported earnings , and it beat earnings estimates, because cost control lifted adjusted EPS This article was written by Oliver Rodzianko 7.3K Followers Follow Oliver Rodzianko is Director of Invictus Origin and a private investor managing a high-alpha portfolio strategy focused on rotation and disciplined cash deployment during market dislocations. Analyst’s Disclosure: I/we have a beneficial long position in the shares of ADBE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.