Pegasystems (NASDAQ:PEGA) Sets New 52-Week Low on Disappointing Earnings

Pegasystems Inc. (NASDAQ:PEGA)’s stock price hit a new 52-week low during trading on Wednesday following a weaker than expected earnings announcement. The stock traded as low as $25.11 and last traded at $25.5130, with a volume of 442845 shares. The stock had previously closed at $30.94.

The technology company reported $0.35 EPS for the quarter, missing analysts’ consensus estimates of $0.43 by ($0.08). Pegasystems had a net margin of 18.66% and a return on equity of 32.21%. The business had revenue of $420.72 million for the quarter, compared to the consensus estimate of $427.38 million. During the same period in the prior year, the company posted $0.28 EPS. The company’s quarterly revenue was up 9.4% compared to the same quarter last year.

Pegasystems Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Wednesday, July 15th. Shareholders of record on Wednesday, July 1st were given a $0.03 dividend. This represents a $0.12 annualized dividend and a yield of 0.5%. The ex-dividend date of this dividend was Wednesday, July 1st. Pegasystems’s dividend payout ratio is 6.45%.

Pegasystems News Summary

Here are the key news stories impacting Pegasystems this week:

• Positive Sentiment: Pegasystems highlighted cloud growth and recurring revenue strength, and management outlined a long-term free cash flow target of more than $700 million by 2028. Pegasystems outlines $700M+ 2028 free cash flow target while highlighting no per token costs for ai agents
• Positive Sentiment: Several analysts kept bullish ratings, saying the selloff may create an attractive entry point despite near-term AI disruption and reset expectations. Analyst Maintains Buy on Pegasystems, Viewing Near-Term Weakness as Temporary and Market Selloff as an Attractive Entry Point
• Positive Sentiment: Rosenblatt cut its price target but still reiterated a Buy rating, implying meaningful upside from current levels. Pegasystems PT Lowered to $47 at Rosenblatt
• Neutral Sentiment: Management said the new Pega Infinity 26 launch and AI agent messaging could support longer-term positioning, but investors are still waiting to see whether it translates into stronger demand. Pegasystems (PEGA) Stock Could Be Undervalued As Pega Infinity 26 Launches
• Negative Sentiment: The Q2 miss triggered a broad downgrade wave, with analysts trimming forecasts and price targets after the weaker-than-expected report. Pegasystems Analysts Cut Their Forecasts After Downbeat Q2 Earnings
• Negative Sentiment: The stock also came under pressure because customers appear to be delaying software purchases while reassessing spending in the AI era, which could weigh on near-term growth. Pegasystems Just Did an IBM, Only Its AI Warning May Be Even Worse

Wall Street Analyst Weigh In

A number of brokerages have recently issued reports on PEGA. Rosenblatt Securities lowered their target price on shares of Pegasystems from $58.00 to $47.00 and set a “buy” rating for the company in a research note on Thursday. William Blair downgraded shares of Pegasystems from an “outperform” rating to a “market perform” rating in a research note on Wednesday. Barclays reiterated an “overweight” rating and set a $39.00 price objective (down from $48.00) on shares of Pegasystems in a report on Thursday. Zacks Research downgraded shares of Pegasystems from a “strong-buy” rating to a “hold” rating in a research note on Friday, April 24th. Finally, Loop Capital lowered shares of Pegasystems from a “buy” rating to a “hold” rating and reduced their target price for the stock from $55.00 to $25.00 in a research report on Thursday. Six research analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the company. According to MarketBeat.com, Pegasystems has an average rating of “Hold” and an average price target of $52.40.

Insider Buying and Selling at Pegasystems

In other news, CAO Efstathios A. Kouninis sold 750 shares of the business’s stock in a transaction on Monday, June 1st. The stock was sold at an average price of $36.99, for a total value of $27,742.50. Following the completion of the transaction, the chief accounting officer directly owned 2,144 shares of the company’s stock, valued at approximately $79,306.56. The trade was a 25.92% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, insider Rifat Kerim Akgonul sold 4,545 shares of the company’s stock in a transaction on Tuesday, May 19th. The stock was sold at an average price of $33.35, for a total value of $151,575.75. Following the sale, the insider owned 107,070 shares of the company’s stock, valued at $3,570,784.50. This trade represents a 4.07% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 6,795 shares of company stock worth $229,613 in the last ninety days. Insiders own 48.40% of the company’s stock.

Hedge Funds Weigh In On Pegasystems

A number of large investors have recently added to or reduced their stakes in the company. International Assets Investment Management LLC purchased a new position in shares of Pegasystems in the 4th quarter worth approximately $28,000. EFG International AG purchased a new stake in Pegasystems during the fourth quarter valued at approximately $32,000. Fifth Third Bancorp boosted its stake in Pegasystems by 96.5% in the fourth quarter. Fifth Third Bancorp now owns 617 shares of the technology company’s stock valued at $37,000 after acquiring an additional 303 shares in the last quarter. Bayforest Capital Ltd boosted its stake in Pegasystems by 316.6% in the fourth quarter. Bayforest Capital Ltd now owns 704 shares of the technology company’s stock valued at $42,000 after acquiring an additional 535 shares in the last quarter. Finally, Brown Brothers Harriman & Co. grew its holdings in Pegasystems by 386.3% in the fourth quarter. Brown Brothers Harriman & Co. now owns 710 shares of the technology company’s stock worth $42,000 after purchasing an additional 564 shares during the last quarter. 46.89% of the stock is currently owned by institutional investors.

Pegasystems Price Performance

The company’s fifty day simple moving average is $32.27 and its 200-day simple moving average is $39.79. The firm has a market capitalization of $4.28 billion, a PE ratio of 14.69 and a beta of 0.87.

Pegasystems Company Profile

Pegasystems Inc is a software company specializing in customer engagement and digital process automation solutions. Headquartered in Cambridge, Massachusetts, Pegasystems develops enterprise applications designed to help organizations streamline operations, manage customer interactions and automate complex workflows. Its platform supports a wide range of use cases, from sales and marketing optimization to case management and robotic process automation.

The core of Pegasystems’ offering is the Pega Platform, a low-code development environment that enables businesses to build and deploy applications with minimal hand-coding.